Sexism in the City
An economically irrational problem
From battling for pay reviews to working the second shift at home, or putting up with aggressive work practices to guessing how much your colleagues earn... why can’t the UK finance sector seem to close the gender pay gap?  research looks at the financial, moral and legal changes needed to move towards an equal society. Starting with the UK financial sector.
In the UK, the gender pay gap is proving to be surprisingly difficult to close, despite over 50 years of legislative efforts aimed at resolving the issue. In the last seven years, firms have been legally required to monitor and publish their pay gap data. The overall pay gap has reduced by only 1.2 percentage points from 12.8% (2017) to 11.6% (2024).  
In some sectors, such as finance, the gap is significantly larger. Lloyds, HSBC, Barclays and NatWest, four of the largest UK banks, reported pay gaps in 2024 as high as 48% and bonus gaps of up to 74%.  
This imbalance has a dampening effect on the whole economy. According to a , closing the gender pay gap in the UK could potentially increase women’s earnings by up to £55 billion per year. It could also encourage more women to join the workforce. Their report estimates that a 5% increase in women in employment has the potential to boost UK GDP by as much as £125 billion a year.  
So why is progress on this issue so slow, particularly in finance? And what impact does it have on the women who work in the sector? For my latest book I spoke to a range of women working in the industry to find out. Here is what I learned.  
Paying the price for becoming a parent 
In the UK’s finance sector, one driver of the gender pay gap is a “motherhood penalty”. For women in finance, coming back from maternity leave means working your way back up. Sacrifices like skipping post-work socialising mean missing networking opportunities, an important lever for career advancement.  
Analysis by the Institute of Fiscal Studies (2021) suggests that most UK gender pay gaps reflect “motherhood penalties", where female earnings actually fall after becoming a parent. Seven years after the birth of their first child, women’s earnings are, on average, less than half of men’s.  
A cultural problem  
Another issue in the finance sector is the rolling back of flexible working policies implemented during the pandemic. This is affecting the recruitment and retention of talented women. 
There are women all over the City who are now working their notice, who have left jobs where they were high-calibre performers because hybrid working enabled them to stick in those roles. There are leaders who are tearing their hair out because they know that they are losing great people.” Fiona Mackenzie
CEO The Other Half, Sexism in the City inquiry HC1746 report
In addition, the finance sector is doing little to address issues like presenteeism and toxic or aggressive work practices, which often drive women away from the sector. 
This points to a deep cultural issue, which is not easily fixed by voluntary workplace equality policies that some businesses have put in place.  
Much of this operates beneath the level of company policy. Interviewees I spoke to reported a significant gap between policy and practice. One said: “They’re very good at putting out things which look good and talk the talk, but when it comes down to it, not much has changed". 
Women's lived experiences
Women in senior UK bank global roles share their experiences
Kaye describes her motivation to change job from a role in capital markets and trading: “The culture was unpleasant, bullying and it drove me to think about moving … It was very aggressive, quite toxic, and accusatory.”  
Alice describes how she wanted to move from retail bank management to a head office role in corporate banking. Her area director responded by telling her: “It’s the wrong role for you, you’re too nice for that.” 
Sophie mentions a pay increase she had received prior to the gender pay gap reporting being implemented:  
“Before the [gender pay gap] report was published, I got an ad hoc pay review, completely out of the blue. The idea of that was to put me in line with my male colleagues. Two weeks later the gender pay gap report was published. It was very nice at that point in time, but then I became suspicious, have I been paid £7k less than male counterparts and for how many years? There was no back pay.” 
Keeping employees in the dark 
A culture of secrecy around pay in some UK finance firms is another driver of the gender pay gap. In some firms, it can be a disciplinary offence to discuss your salary.  The women I interviewed said this erodes their ability to successfully negotiate increases; prevents them from accurately positioning themselves when applying for a new role; and makes it hard to tell when they are being paid below potential comparators. The UK government introduced a to level up employment opportunities, but shied away from making this mandatory. 
Five ways to tackle the gender pay gap
- Look at what other jurisdictions have done and how much further ahead of the UK they are. In large parts of the US, Australia and Canada it is illegal for employers to ask job applicants about their salary history.
- Make the action plans that companies produce to improve equality mandatory rather than voluntary. It’s not enough to say if it gets monitored it gets done.  
- Strengthen and improve the current legal policies and recommendations such as improving transparency around pay.  
- Widen the number of firms reporting on the gender pay gap by including smaller companies (those with over 50 employees, compared to the current threshold of 250). Extend ethnicity and disability reporting to follow the evidence that improving diversity reduces the risks of “groupthink”. 
- Equality needs to be seen by government and organisations as critical, not just a “nice to have”. 
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