The gender pay gap and female presence in management 2023

3 May 2023

Presencia Femenina 1Despite Government plans for equality and the implementation of teleworking by many companies during the pandemic, little progress has been made to increase the number of women in management positions and reduce the wage gap with their male counterparts, as revealed by the 17th edition of the EADA and ICSA Grupo report on the Gender pay gap and female presence in management 2023. Female presence in management positions has stagnated at 16.6% compared to 16.8% in 2022. This is clearly evident in General Management positions, where women occupy 8.8% of total positions and drops to 7.6% in Sales Management and 5.9% in Manufacturing Management, respectively. However, female presence has increased to 32.9% in Human Resources Management and 19.5% in Administration and Finance Management.

In terms of professional categories, the wage difference depends on the level of responsibility and power in the organisation. The percentage of women in senior management positions barely reaches 17% while this figure increases to 35.8% in middle management and 45.9% for entry level positions. In companies, the proportion of female managers is considerably higher in smaller companies (55.6%) compared to medium-sized companies (25%) and large companies (19.4%), which is illustrated by the fact that only three IBEX-35 companies have female CEOs.

The pay gap between men and women in all professional categories remains unchanged at around 12%. In absolute terms, the current average gross salary for men in senior management roles is 91,825 euros a year compared to 81,913 euros for their female counterparts, which represents a percentage difference of 12.1% or 10,000 euros less a year. For middle managers, men earn on average 46,678 euros gross salary whereas women earn 41,568 (a difference of 12.3%). In the employee category, gross salaries for men reach 29,094 euros while women receive 12% less with 25,985 euros.

The EADA-ICSA report also shows that more women have received higher education training: 42.8% of women have a Master’s or postgraduate degree compared to 42.4% of men. The percentage of women with university studies is also higher with 47.8% compared to 44.9% and more men than women have not completed university studies, 12.7% compared to 9.3% respectively.

Main causes of the current stagnation

Presencia Femenina 2There are various reasons that explain the current unfavourable situation for women. According to Dr Aline Masuda, co-director of the study and professor at the Department of Strategy, Leadership & People at EADA Business School, one of the main reasons is that “management positions are still highly masculinised”. In her opinion, “management roles continue to invoke masculine stereotypes linked to prestige, ambition and remuneration instead of more important qualities such as active listening, communication skills and the care and well-being of the team, which are more closely associated with female leadership”.

Another tendency in need of change is the business world culture. Masuda points out that “there is no point approving legislation or equality plans if organisations are not prepared to promote gender equality at all levels.” In this area, she recommends redesigning job positions, avoiding discriminatory biases – without the need for men or women to hold absolute power – promoting salary flexibility and transparency to be able to balance work and family life. According to Indry Canchila, co-author of the report and managing partner at ICSA Grupo, “many women who started in a management role during the pandemic have left their positions or transferred to a middle-management role due to the difficulties faced in balancing work and family responsibilities. Masuda adds that, “many of them prefer to reject a management role when they see the amount of travel or meetings involved because of the difficulties it might cause in their work-life balance. This is why companies need to review job descriptions and promote flexibility”.

Masuda also believes that the implementation of teleworking during the pandemic by most companies has evolved towards a hybrid model of working in the office on specific days and at home on the others. “These hybrid models are not synonymous with greater flexibility since the office working days are often imposed by the company and working to objectives has still not been implemented”. As she points out, “in times of crisis and uncertainty such as now, companies return to rigid working models and women are put at a disadvantage”.

As well as a change in organisational culture, Masuda advocates the need for greater awareness of the division of household tasks. “Today, the majority of women still take care of the home”. In her opinion, “companies should also promote a work-life balance for men so that women do not have to bear that responsibility”.

Ernesto Poveda, President of ICSA Grupo, considers that “companies are not taking advantage of the current female talent in all sectors. The countries that have managed to deal with the current economic crisis are those that have incorporated more female talent in their organisations, especially in management positions”. Dr Masuda agrees, stating that “a higher proportion of women in management roles implies better strategic decision-making, higher productivity and greater innovation”.