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Neil Carberry: Making sure reporting works for you and your staff

Friday 30 June 2017

Neil Carberry, Managing Director of People and Infrastructure at the Confederation of British Industry discusses gender pay reporting.

Neil Carberry Neil Carberry

Managing Director, People and Infrastructure, Confederation of British Industry

Neil is a member of the council of Acas and of the Low Pay Commission, which makes recommendations about the level of the National Minimum Wage. He is a Chartered Fellow of the CIPD.

Before becoming director, Neil spent four years as Head of Employment and Pensions Policy and he has previously worked in the CBI's public services team as Head of Public Procurement.

Neil joined the CBI in 2004, after completing a postgraduate degree at the London School of Economics in industrial relations. Before this, he worked as an HR consultant for a number of major financial institutions.

Gender pay gap reporting is a policy and a process - but it is how we use it that makes the difference.

I'll be honest - at the time of the 2010 Equality Act, the CBI didn't warm to the idea of mandatory reporting, despite the fact that we tend, in principle, to favour transparency when it comes to issues like this. Why? Because what matters on this issue is the outcome we achieve - closing pay gaps by addressing their deep-rooted causes in work and outside of it. Businesses were worried that a tick-box, legalistic process would obscure this.

To be fair, there are clear reasons behind why businesses saw the issue this way. Too often, politicians and others confuse illegal equal pay - paying women and men differently for work of equal value - with the gender pay gap, which is the average pay of women and men, irrespective of the job they do. Businesses felt they would be held to account unfairly for data that they have only partial control over - or accused of breaking the law. That's still a risk.

Unequal pay is immoral and illegal - and employees should have access to effective redress where the law is broken. But the pay gap is more difficult to address. The things that drive it - career and academic choices, progression routes through businesses, issues related to work-life balance and caring responsibilities are more complex and multi-faceted than is often acknowledged in our public debate.

Of course, we cannot let complexity be an excuse for inaction - and many businesses feared that a process followed by inaction was what reporting would turn out to be. A cost, but not an opportunity.

It's up to businesses to make sure that is not the case. That's why the CBI fairly quickly turned its attention to making reporting work after the intention to introduce the new rules became clear.

At the heart of this is a question of ownership. If we really want to make a difference on closing the pay gap, a strong partnership between businesses and government is needed. Government can address deficits in careers advice and care infrastructures - but as businesses we need to look at ourselves and what we can do. To be effective, reporting has to be about companies and their actions - not just the law.

Over the past two years the rules have evolved to allow this to happen - using additional reporting to set context and be clear about plans of action will help make sure transparency passes the test firms set back in 2010 - actually improving things in companies around the country and not just introducing a process that might be open to gaming.

It's now up to firms to pick up this challenge and run with it. We know that meaningful action on issues like recruitment, progression and flexibility not only helps close the gap, it retains talent and makes a firm the employer of choice. That will have also have productivity benefits, as engagement and talent retention improves along with the higher quality decision-making that research shows more diverse groups foster.

So - whatever we or you thought of mandatory reporting - the right choice now is to step up and try to use it as a tool to make things better for us as businesses, not a government process. Acas has provided some excellent guidance for firms to use, and the CBI has also published a guide [PDF, 2.7mb] - let's see if we can make this work.

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