Research carried out by New Street Consulting Group has found that the average pay for FTSE100 female directors currently stands at £237,000 – 73% less than the average pay for FTSE100 male directors at £875,900. The research shows that the gender pay gap amongst FTSE100 directors is far worse than in the broader job market, with women receiving 15.5% less pay than men.

The gender pay gap is the difference between the average earnings of men and women, expressed relative to men’s earnings. The large pay gap at board-level is largely due to 91% of female directors at FTSE100 companies holding non-executive rather than executive roles, which tend to have a much lower remuneration than executive roles. Women that do make it to executive roles still face a significant wage gap, earning on average £1.5m, whilst men in the same role earn £2.5m.

The government-backed Hampton-Alexander review, published in February 2021, which looked at female representation at the top of business, revealed that its target of 33% of board positions at FTSE 100 and FTSE 250 firms being held by women by 2020 had been achieved. Sir Philip Hampton, who chaired the review, praised the progress but said businesses needed to recruit and promote women to top executive roles “to sustain the changes made”.

Claire Carter, director at NSCG, said:

“Whilst great progress has been made in bringing more women onto boards, this research shows there is much more to do. Focusing solely on the percentages of directors that are women is not enough when trying to approach equality.

“Most businesses want to end the old boys club that exists at the top. The key to doing that will be ensuring that women have more executive responsibilities and are trained and prepared properly for taking on that responsibility. Allocating them with the right assignments and projects is essential to that process.

“Ultimately the catalyst for change lies with the boards themselves. It will be a case of their examining whether there are any barriers that are preventing females from reaching the very top at their organisation, and if there’s anything they can do to help overcome these.”

Studies show that having females on boards has been associated with better future financial performance, including higher profits and stock market returns. A report by the FRC from July 2021 estimates that having at least one woman on the board could increase stock prices by 10% in just one year, increasing to 25% in five years for boards with 33% representation of women.