UK gender pay gap narrows in financial services boardrooms, EY finds

The gender pay gap across UK financial services boardrooms decreased 5% between 2019 and 2023, from 30% to 25%, according to the latest EY European Financial Services Boardroom Monitor. 

The difference in the overall remuneration of men and women across the UK’s financial boardrooms during the four-year period decreased due to a marginal fall in remuneration for male board directors at UK firms, and a concurrent uptick in remuneration for their female peers. 

Overall pay across UK financial boardrooms fell between 2019 and 2023 on an average basis but remained higher than the European average every year through the period. 

North American non-exec directors were found to have received significantly higher overall remuneration than their counterparts in the UK, primarily as a result of receiving equity and stock options in addition to their fixed-fee compensation, which UK and EU boards do not offer for independence and objectivity reasons.  

Martina Keane, EY UK and Ireland financial services leader, said: “UK financial services firms have made clear progress towards more equitable pay for male and female board directors, but the pay gap between genders remains stark. While more men than women sit on committees and occupy chair roles, the fact that women on UK boards earn a quarter less than their male peers on average is a concerning reality. 

“Global competition for talent at board-level is only growing, and UK financial services firms must do more to further improve gender equity in their boardrooms and balance remuneration levels.”

Between 2019 and 2023, average remuneration for female non-exec board directors across UK financial services firms increased 7%, from $209,987 in 2019 (£172,536) to $225,275 (£185,097) in 2023. 

By comparison, over the same period, the gender pay gap across European financial services boardrooms increased by five percentage points, from 31% to 36%. Between 2019 and 2023, average remuneration for female non-exec board directors across European financial services firms increased by 12%, from $164,584 (£135,230) in 2019 to $184,477 (£151,575) in 2023. 

In 2023, female directors tracked across UK financial boardrooms earned $75 (£61) for every $100 (£82) earned by male peers, compared with $70 (£57) for every $100 (£82) earned by male directors in 2019, representing a 5% decrease in the gender pay gap. 

Comparing this to female non-exec board directors at North American financial services firms, women earned an average $95 (£78) for every $100 (£82) earned by their male peers, compared with $93 (£76) for every $100 (£82) earned by male directors in 2019. This represents a two percentage point decrease in the gender pay gap.

The gender split (as at the end of 2024) across directors of UK financial services firms stands at 45% female and 55% male, compared to 43% female and 57% male across European financial services firms more broadly. 

Data for North American firms shows that at the end of 2023, board-level female representation was 9% lower than the UK, at 36% female and 64% male. A total of 21% of UK financial services firms have less than 40% female representation at board level – the same vs the end of 2023. In comparison, 28% of European financial services firms have less than 40% female representation. 

The research also shows that total levels of remuneration across UK financial boardrooms fell between 2019 to 2023 but remained higher than European boardrooms in every year through the period. 

However, the pay gap between UK non-exec directors and their peers in Europe narrowed over the period. In 2023, UK non-exec board directors were paid 10% more than their peers across Europe more broadly, earning $266,368 (£218,861) versus $242,715 (£199,427) respectively. 

Omar Ali, EY global financial services leader, said: “The landscape for boardroom remuneration across financial firms in Europe is shifting, and compensation is a key consideration for chairs as they build and maintain their boards in an increasingly global industry. This is particularly the case as chairs of UK firms contend with the more lucrative packages offered in North America, which often include equity and options awards.

“Offering competitive – and importantly, equitable – pay is essential to ensure that boards are equipped with the skills and diversity necessary to navigate evolving market risks and challenges. A structured review of regional pay disparities – and the steps that can be taken to address them – is now integral to maintaining the strength of the UK financial services sector.”