It's a fact of life that we often hire or promote the same sorts of people – even when we think we're selecting the best person for a job. Many organisations have fallen foul of this bias, and the finance profession is certainly not immune.
For example, in a university-based study, job applications were sent out to 120 science professors, who were then asked to rate the candidate in terms of competence and hireability. They also made recommendations about an appropriate starting salary.
Each professor received the same application materials, though some were submitted under a male name and some under a female name. The results showed that applications under a man's name were rated more competent (and the candidate more hireable) than the identical application under a women's name. Women were, on average, offered lower starting salaries, by a factor of around 12%. Interestingly, both male and female professors exhibited this bias.
This is just one of the many examples of studies that demonstrate the reality that people act on ingrained biases and stereotypes, even when presented with evidence that contradicts them.
"There is robust evidence that automatic mental associations about social groups impact our perceptions and decision-making and that people tend to hold more negative associations toward a variety of historically oppressed groups".
– Frederick Herbert, London School of Economics
Recognising this situation is the first step to making recruitment – and your entire workplace – more inclusive. That's why many organisations now use "blind" recruiting, where names, genders and ages are removed from applications before they are evaluated.
These biases feed into the "gender pay gap", an established phenomenon in which women have been found to be paid less than their male counterparts. The finance profession is, unfortunately, a prime offender, with the gender pay gap currently being reported as 21.5%, compared to a national average of 18.4%.
Addressing these gaps goes beyond raising salaries, and instead requires managers to think through why fewer women hold the highest-paid roles. One organisation has improved its gender pay gap by implementing a broad range of actions.
Yorkshire Housing is a non-profit organisation that builds and manages thousands of affordable and social-rent homes across 20 local authorities in the north of England. In just one financial year, Yorkshire Housing recently cut its average gender pay gap by over 8%.
At the start of the year the average gender pay gap was 9.5%, while the median gap sat around 15%. To tackle this, Yorkshire Housing identified and implemented a number of positive actions. Each was designed to improve staff retention by focusing on wellbeing, morale and mental health.
Flexible means flexible
According to Nina Evison, Head of People for Yorkshire Housing, the organisation made "flexible working genuinely flexible" by embracing new technology and empowering staff to decide how they could best meet business and customer needs. Parents dealing with childcare, or people with other caring responsibilities, were therefore empowered to arrange their working day for best effect. While all staff can benefit from this policy, many women would particularly appreciate such a flexible approach to working hours.
A wage to live on
After consulting statistics that showed similar policies elsewhere had increased motivation and retention, the organisation made sure it was paying at least the voluntary "real living wage" to every employee.
In the UK, the real living wage, which is based on what employees and their families actually need in order to be able to live, is 12% higher than the government-mandated minimum wage.
Yorkshire Housing appointed more women to senior roles, until 52% of the board and committee members were women. Despite this success, there is still work to do in other areas of the business. As Evison says, "in traditionally male-dominated areas of our business, we have to work hard to break down stereotypes and recruit more women".
Raising organisation-wide awareness
Finally, they rolled out diversity and inclusion training across the organisation, so everyone understood their own individual role in achieving a fair and equal workplace. Evison says this included improving "how we recruit, retain and develop the best talent based on the principles of fairness, equality and respect for all".
Yorkshire Housing's experience shows that it is possible to make lasting change around a long-established issue like the gender pay gap. However, such change is only likely to come by implementing a multi-pronged approach – one that covers everything from minimum salaries and working hours to recruitment and training.
With female accountants taking roughly three times as many career breaks as their male counterparts , it’s important to keep in mind that, whilst tackling attitudes is helpful, women are still more likely to devote time to issues beyond their work life. It is therefore crucial that organisations adapt around these needs, and this requires tangible solutions.
Anna Faherty is an author for accountingcpd. To see her courses, click here.