Switzerland lands in ILO hall of shame over sexist wage gaps

Equal pay between men and women has been anchored in the Swiss constitution since 1981, a principle that was sharpened by the 1996 Gender Equality Act. Progress is slow. Keystone

Over 60% of the world’s companies mindful of gender diversity in decision-making positions are reaping the rewards with expanding profits. Switzerland is at the bottom of the list when it comes to the wage gap between men and women in senior roles.

In Europe and central Asia, only Italy, Kazakhstan and Israel pay even less for women managers than their male counterparts. Looking at employees across the board, Switzerland has the third largest gap between men and women, behind Austria and Israel, according to the International Labour Organization (ILO), after a survey of 13,000 companies in 70 countries.

The surveyExternal link, published on Wednesday, puts Switzerland in 21^st place for the proportion of women in management – about one-third. However, it is also one of the countries with the lowest percentage of women in tertiary education compared to men.

Worldwide, despite corporate commitments, progress for more women in leadership positions is “uneven”, an ILO official told reporters on Wednesday. Some countries are doing better, but others have seen the situation deteriorate. The number of female bosses has not really changed and is still less than a quarter.

The ILO also found that women are more likely to manage small- and medium-sized enterprises (SMEs). They constitute 26% of the bosses of these companies.

The report by the Geneva-based ILO stresses that the beneficial effects of diversity are observed as soon as at least 30% of women as leaders or senior managers work in a company. Almost 60% of companies do not reach this share.

No quotas

However, the ILO does not formally recommend quotas. Corporate culture is more decisive than having a system in place, says the head of the organisation. For example, while the share of women in leadership roles has increased in Norway, the reality is that the same women often find themselves on boards of directors.

The benefits for companies with a diversity policy, nearly three-quarters of those surveyed, are important, the report shows. Almost three-quarters of these companies reported an increase in their results from 5 to 20%. The majority achieve a profit increase of 10 to 15%. Almost 58% of respondents admit that initiatives for greater diversity between men and women contribute to this.

The same number say increasing female representation helps attract quality employees. Almost as many add that the company’s brand has been strengthened. More than half say they are more innovative. Another indication, according to three-decades worth of figures ending in 2017 and drawn from more than 185 countries, is the increase in women’s participation rate and the growth of Gross Domestic Product (GDP) are linked everywhere except in Asia/Pacific.

Family tasks are always an obstacle and a corporate culture based on men does not promote diversity either. The ILO encourages more favourable policies such as reducing gender pay gaps, flexibility and paternity leave. According to an ILO official, companies are changing their attitudes because they want to better reflect their markets and the wider society.