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The next Government should ensure there is a UK target for reducing the gender pay gap, says the CBI.

The UK’s leading business group is calling for a commitment from the next Government on a national target to bring the issue of the gender pay gap sharply into focus, in the same way the Lord Davies review has shone the spotlight on women on boards.

Reaching the target would then require progress in the areas which have a real impact on equal pay, such as improved careers guidance in schools, an increased understanding of the benefits of flexible working for parents and businesses, and affordable childcare.

Katja Hall, CBI Deputy Director-General, said: “Gender should not define what people earn and we need to put equal pay firmly into the spotlight.

“Currently, too many areas of work – often those with high pay potential – are seen as male-dominated, with women steered away from options that would give them better access to higher pay and seniority.

“This simply has to change. We must focus on tackling the pay gap by providing the right careers advice in schools and boosting support in the workplace for career development.

“A future Government should ensure an overall target for the reduction of the gender pay gap is set at a national level to raise awareness of this issue.

“And this would mean we can clearly track if more progress is really being made on gender diversity.”

A new CBI paper – Building on Progress – outlines business and Government priorities for boosting gender diversity in the workforce. These include:

  • Government funding for a nationally-mandated, locally-run system to support employer engagement in careers services
  • Every sixth form, college and university setting and reporting against targets for female participation in key subjects, such as physics
  • Businesses committing to meaningful diversity policies and, where possible, aspirational targets, with a focus on supporting women within the workforce and re-integrating maternity returners effectively into their roles
  • Businesses showing greater openness to job-sharing in more senior roles and ensuring recruitment processes maximise the diversity of shortlists
  • The Government doing more to raise awareness and understanding of the benefits and options for flexible working, including better guidance for businesses
  • The Government considering increasing the amount of free provision of childcare when it is affordable to do so, especially for those from low income backgrounds
  • Any future Government making equal pay a priority, in the same manner that the Lord Davies review shone the spotlight on women on boards.

While there is still more to do, Building on Progress highlights the positive steps that have been taken on women on boards, with recent figures showing that over a fifth of all FTSE 100 board posts are now held by women. Female participation in the UK labour market is also at a high and continuing to rise.

Building on Progress says the key to making further progress is addressing the causes of the pay gap, rather than ordering actions on a punitive basis. Mandatory equal pay audits and company pay gap reporting, for example, would be both disproportionate and burdensome for firms at a time when we should be focusing on ensuring sustainable growth.

The CBI has also committed to becoming a more diverse organisation. The CBI Board has approved a target of 30% female representation at its events and in its policy making processes, on a comply and explain basis.