This post is sponsored by Philip Morris International
There is a gender pay gap worldwide. Globally, it is estimated that the gap is at 19%, with men occupying more senior and higher paying roles and sectors, according to the International Labour Organization. Unequal pay for equal work, however, is a factor in the pay problem, too.
Philip Morris International recently became the first multinational company to become certified for equal pay between men and women on a global level. Marian Salzman, senior vice president of global communications at PMI, recently spoke at the Press Club in Washington D.C. about how PMI achieved this first-of-its-kind global EQUAL-SALARY certification.
The EQUAL-SALARY journey
Salzman detailed the path to the global certification. PMI underwent a four-step process:
- Statistical analysis. PricewaterhouseCoopers conducted an in-depth review of employee salary data, which include a report about special cases and explanations for each.
- On-site visits. PwC performed on-site audits that assessed affiliate management’s commitment to equal pay, female employees’ perception of that commitment and sustainable equal pay practices. They also included a review of HR policies aimed at identifying gender blind spots that prevent women from progressing inside the organization.
- Reporting and certification. Once the first two steps were completed, the EQUAL-SALARY Foundation issued the certification and logo.
- Monitoring. The certification is valid for three years. Certified companies must submit to a monitoring visit each year and demonstrate ongoing commitment to the cause and continuous improvement towards sustainable pay equity.
In explaining the process, Salzman underscored the learnings and insights uncovered by EQUAL-SALARY Foundation’s entrusted auditors PwC. These included the importance of each management team digging deeper into their data at every salary level to analyze the proportion of women versus men being recruited, plus comparing female versus male performance ratings, promotions, engagement scores, attrition rates and more.
From that data analysis, PMI developed target numbers designed to increase the representation of women in management roles across the company, including at senior leadership levels. The goal is to reach 40% by 2022. PMI’s HR team—known as People & Culture—created a data dashboard to support transparency. Progress is reported quarterly, with leaders expected to meet their targets or explain why not.
Improving leadership equality
Salzman pointed out that equal pay for equal work is not the end goal at PMI—it’s equal opportunity. This, she explained, is critical to closing the gender pay gap inside organizations, sectors and across all areas of society. One area for improvement at PMI, highlighted throughout the EQUAL-SALARY process, is gender balance in leadership roles. In 2014, 29% of PMI’s leadership team were women. In five years, that number has increased to 36% and there is still room for progress.
Salzman encouraged attendees to put themselves through the exercise and ask this question: What would we look like if, as an organization, pay AND work were equal for women and men? She urged the leaders in the room to really examine what equal work for equal pay looks like.
“Better is not good enough,” Salzman told attendees. Organizations that do things the way that they have always been done, even if they were successful in the past, will eventually plateau. Transforming business models to support equality—starting with gender balance and improving equal opportunities—leads to greater success and reach for companies.
If you would like to learn more about PMI’s global EQUAL-SALARY certification journey and progress toward a gender-balanced organization, watch the On-Demand webinar hosted by Sustainable Brands. Register now.
Additional resources from PMI
- Using certifications to drive progress on gender balance: Observations from PMI’s global EQUAL-SALARY certification
- EQUAL SALARY Foundation
- Global Wage Report 2018/19 from the International Labour Organization
- PMI’s commitment to equal pay
- Philip Morris International obtains global EQUAL-SALARY certification in DiversityQ
If you enjoyed this article, sign up for the Business Transformation SmartBrief to get news like this in your inbox, or check out all of SmartBrief’s business newsletters, covering topics such as leadership, human resources, small businesses and policy & advocacy.