- Gender pay gap across UK financial services boardrooms fell five percentage points from 2019 and 2023, despite rising five percentage points across Europe
- UK non-exec board directors were paid 26% less than North American peers, but 10% more than European peers
The gender pay gap across UK financial services boardrooms decreased five percentage points between 2019 and 2023, from 30% to 25%, according to the latest EY European Financial Services Boardroom Monitor, which incorporates new analysis on the most recently reported non-executive (non-exec) director remuneration.
The difference in the overall remuneration of men and women across the UK's financial boardrooms during the four-year period decreased due to a marginal fall in remuneration for male board directors at UK firms, and a concurrent uptick in remuneration for their female peers.
Overall pay across UK financial boardrooms fell between 2019 and 2023 on an average basis but remained higher than the European average every year through the period.
North American non-exec directors were found to have received significantly higher overall remuneration than their counterparts in the UK, primarily as a result of receiving equity and stock options in addition to their fixed-fee compensation, which UK and EU boards do not offer for independence and objectivity reasons.
Martina Keane, EY UK & Ireland Financial Services Leader, commented: "UK financial services firms have made clear progress towards more equitable pay for male and female board directors, but the pay gap between genders remains stark. While more men than women sit on committees and occupy chair roles, the fact that women on UK boards earn a quarter less than their male peers on average is a concerning reality. Global competition for talent at board-level is only growing, and UK financial services firms must do more to further improve gender equity in their boardrooms and balance remuneration levels."
Global gender pay comparisons
Between 2019 and 2023, average remuneration for female non-exec board directors across UK financial services firms increased 7%, from US$209,987 in 2019 to $225,275 in 2023. During this time, remuneration for male non-exec directors decreased 1%, falling from $301,966 to $299,076.
By comparison, over the same period, the gender pay gap across European financial services boardrooms increased by five percentage points, from 31% to 36%.
Between 2019 and 2023, average remuneration for female non-exec board directors across European financial services firms increased by 12%, from US$164,584 in 2019 to $184,477 in 2023. During this time, remuneration for male non-exec board directors increased at a higher rate of 21%, rising from $238,706 in 2019 to $287,994 in 2023.
Over the same period, the gender pay gap across the boardrooms of the largest North American financial services firms narrowed two percentage points, from 7% to 5%.
Remuneration awarded to female non-exec board directors across North American financial services firms increased by 13%, from $287,465 in 2019 to $324,250 in 2023. Pay awarded to male non-exec board directors increased at a slower rate of 10%, from $309,392 in 2019 to $340,481 in 2023.
In 2023, female directors tracked across UK financial boardrooms earned $75 for every $100 earned by male peers, compared with $70 for every $100 earned by male directors in 2019, representing a five percentage point decrease in the gender pay gap.
In contrast, in 2023, female directors tracked across European financial boardrooms earned $64 for every $100 earned by male peers, compared with $69 for every $100 earned by male directors in 2019, representing a five percentage point increase in the gender pay gap.
Comparing this to female non-exec board directors at North American financial services firms, women earned an average $95 for every $100 earned by their male peers, compared with $93 for every $100 earned by male directors in 2019. This represents a two percentage point decrease in the gender pay gap.
Gender splits within UK, European and North American boardrooms
The gender split (as at the end of 2024) across directors of UK financial services firms stands at 45% female and 55% male, compared to 43% female and 57% male across European financial services firms more broadly.
Data for North American firms shows that at the end of 2023, board-level female representation was nine percentage points lower than the UK, at 36% female and 64% male.
Twenty-one percent of UK financial services firms have less than 40% female representation at board level – the same vs the end of 2023. In comparison, 28% of European financial services firms have less than 40% female representation.
UK non-exec directors are paid more than European counterparts, despite fall in overall pay levels
Total levels of remuneration fell across UK financial boardrooms fell between 2019 to 2023 but remained higher than European boardrooms in every year through the period.
In 2019, UK non-exec board directors were paid 27% more than their counterparts in Europe more broadly. Boardroom remuneration across the sector in the UK averaged $269,802 per director (on mean), versus $212,360 across Europe’s financial boardrooms.
However, the pay gap between UK non-exec directors and their peers in Europe narrowed over the period. In 2023, UK non-exec board directors were paid 10% more than their peers across Europe more broadly, earning $266,368 versus $242,715 respectively.
This is due to mean remuneration for UK non-exec directors falling by 1% between 2019 and 2023, from $269,802 in 2019 to $266,368 in 2023, while over the same period, mean remuneration for non-exec directors across Europe rose by 14%, from $212,360 to $242,715.
North American non-exec directors are paid more than UK counterparts
UK board directors were paid less than their North American counterparts in every year from 2019 to 2023, with the pay gap between the UK and North America widening over the period.
In 2019, North American non-exec board directors were paid 12% more than their counterparts in the UK. Boardroom remuneration across the sector in North America averaged $302,814 per director, versus $269,802 across UK’s financial boardrooms.
In 2023, non-exec board directors across North American financial services firms were paid 26% more than peers in the UK, earning $334,707 per director versus $266,368, respectively.
Female non-exec board directors at North American financial firms, who are paid less than their male peers in the region, still earn 8% more than male non-exec board directors at UK financial services firms, according to the latest available data. In 2023, remuneration for female non-exec board directors at North American firms averaged $324,250, versus $299,076 for male non-exec directors at UK firms.
Non-cash remuneration, including equity and options awards, was found to be a major component of overall remuneration awarded to non-exec board directors across North American financial firms. It is a practice that is virtually non-existent across UK boards, as the country's corporate governance codes discourages non-exec directors from receiving any variable pay in order to maintain independence and objectivity.
In 2019, 54% of remuneration awarded to non-exec board directors across North American financial firms was structured in non-cash terms through equity or stock option awards, rising to 56% by 2023. While UK non-exec board directors receive less remuneration overall, average fixed-fee compensation is much higher than that awarded to their North American counterparts. In 2023, the average fixed-fee compensation for North American non-exec board directors, excluding non-cash elements such as equity or stock option awards, was $156,811, compared with $266,368 for UK non-exec board directors.
European market comparisons in non-exec boardroom remuneration
Across European markets, non-exec directors at UK financial services firms were the third most well-remunerated in 2023, behind directors at Swiss and Spanish firms. On a median basis, UK directors were paid $199,856 in 2023, with Swiss and Spanish directors receiving $338,621 and $252,570 respectively, on median.
Absolute levels of female remuneration across European markets follow a similar pattern. Female board directors at Swiss, Spanish and UK financial services firms received the highest overall pay in 2023, at $254,732, $246,491, and $191,000, respectively. Female board directors at Norwegian, French and Swedish firms received the lowest overall pay on median in 2023, at $60,141, $86,184 and $108,883, respectively.
At 11%, the UK has a smaller gender pay gap on median than Switzerland (49%), Denmark (27%), Germany (20%) and Italy (14%), and a wider gender pay gap than Spain (7%). Financial services firms based in Norway have the narrowest board-level gender pay gap, with female board members at Norwegian firms paid 25% more than their male counterparts ($60,141 for women on median compared to $48,233 for men).
European sector comparisons
Within the UK financial services industry, non-exec directors in the banking sector were paid the most in 2023, at $296,785 on median, followed by directors at UK insurers ($191,000) and UK asset managers ($135,000).
Within the European banking sector, UK non-exec directors received the second highest remuneration compared with other markets in 2023. On median, non-exec directors at UK banks were paid $296,785 in 2023, behind only directors at Swiss banks, who were paid $653,160 on median.
Within the European insurance sector, UK non-exec directors received the third highest remuneration compared with other markets in 2023. On median, non-exec directors at UK insurers were paid $191,000 in 2023. This was behind non-exec directors at Swiss and Italian insurers, who were paid $338,395 and $205,780 respectively, on median.
Within the European wealth and asset management sector, UK non-exec directors received the third highest remuneration compared with other markets in 2023. On median, non-exec directors at UK asset managers were paid $135,000. This was behind non-exec directors at Swiss and Dutch asset managers, who were paid $235,138 and $168,564 respectively, on median.
UK non-exec directors with c-suite or ESG skillsets earn the highest
Levels of remuneration across the UK’s financial boardrooms also vary according to directors’ skillsets and professional backgrounds.
Between 2019 and 2023, non-exec directors across the UK’s financial boardrooms with prior experience in a c-suite role were awarded higher remuneration every year. Most recently, in 2023, non-exec board directors with c-suite experience were paid an average of $304,562, compared to $258,190 to those without c-suite experience.
A similar trend is evident among board directors with sustainability expertise; in 2023, UK non-exec board directors with sustainability expertise were paid an average of $365,884, compared to $269,523 to those without sustainability expertise.
Omar Ali, EY Global Financial Services Leader, concludes: “The landscape for boardroom remuneration across financial firms in Europe is shifting, and compensation is a key consideration for chairs as they build and maintain their boards in an increasingly global industry. This is particularly the case as chairs of UK firms contend with the more lucrative packages offered in North America, which often include equity and options awards.
“Offering competitive – and importantly, equitable – pay is essential to ensure that boards are equipped with the skills and diversity necessary to navigate evolving market risks and challenges. A structured review of regional pay disparities – and the steps that can be taken to address them – is now integral to maintaining the strength of the UK financial services sector.”
Quick remuneration data overview as at December 31st 2023 (latest reported data)
- Total number of firms tracked across the UK: 19
- Total number of UK non-executive board directors monitored: 290
- Total number of female non-executive board directors monitored: 121
- Total number of male non-executive board directors monitored: 169
- Total number of firms tracked across Europe: 87
- Total number of European non-executive board directors monitored: 815
- Total number of female non-executive board directors monitored: 356
- Total number of male non-executive board directors monitored: 459
- Total number of firms tracked across the United States and Canada: 86
- Total number of North American non-executive board directors monitored: 834
- Total number of female non-executive board directors monitored: 294
- Total number of male non-executive board directors monitored: 540
Quick UK Boardroom Monitor data overview as at December 31st 2024
- Total number of firms tracked across UK: 19
- Total number of UK board directors monitored: 210
- Total number of female board directors monitored: 94
- Total number of male board directors monitored: 116
- Total number of UK board director exits in 2024: 25
- Total number of new UK board directors in 2024: 18
Quick European Boardroom Monitor data overview as at December 31st 2024
- Total number of firms tracked across Europe: 90
- Total number of European board directors monitored: 1093
- Total number of female board directors monitored: 467
- Total number of male board directors monitored: 626
- Total number of European board director exits in 2024: 137
- Total number of new European board directors in 2024: 134
Notes to editors:
- This is the sixth launch of the EY European Financial Services Boardroom Monitor.
- Remuneration data reflects the latest reporting period to 31st December 2023, and only covers non-executive directors.
- Data on the experience, background, and skillsets of board members (excluding remuneration data) across European financial services firms is current as at 31st December 2024.
- The EY European Financial Services Boardroom Monitor does not track the race and ethnicity of board members, as there is no standardized format for directors to disclose against.
About the EY Boardroom Monitor
- The EY Financial Services European Boardroom Monitor tracks the experience, background, and skillsets of board members across a defined universe of financial services firms to create a broad picture of the gaps in expertise and possible pressure points within the listed European financial services markets.
- The EY Financial Services European Boardroom Monitor tracks and analyses data across a wide range of factors, including gender and age, as well as professional experience and skills.
- The EY Financial Services European Boardroom Monitor is comprised of disclosable, publicly available data on board appointments at listed banks, wealth and asset managers, FinTechs and insurers across the UK, Austria, Belgium, Denmark, Finland, France, Germany, Italy, Netherlands, Norway, Spain, Sweden and Switzerland, using the MSCI European Financials Index, with additional data this year from the United States and Canada, using North American-listed constituents of the MSCI World Financials Index, as the core universes.