The Pension Protection Fund (PPF) has published its 2021 diversity pay gap revealing a sharp drop in its ethnicity pay gap.
The lifeboat fund said its ethnicity pay gap decreased from 23.15% at 31 March 2020 to 15.6% at the end of March this year.
The PPF added the scheme now has 50% female representation in its workforce and has increased female representation on both its board and executive committee.
PPF chief people officer Katherine Easter said: "We're absolutely committed to making the PPF a fair and inclusive place to work, and an important part of this is monitoring our pay gaps to ensure we understand what is preventing our pay gaps being zero. This is why we continue to go above and beyond our statutory obligations and report our ethnicity pay gap.
"We're pleased to report our efforts to improve representation across the business have reduced our ethnicity pay gap by 7%, and the proportion of ethnic minority employees who receive bonus pay has increased by 21% too - in line with our increase in recruiting a more diverse workforce."
The PPF has reported that an underrepresentation of ethnic minority employees in senior management roles and in business areas which command higher pay and bonuses - such as investment, risk and IT - are the driving factors for their current ethnicity pay gap.
To address this, the fund has set targets which will increase ethnic minority representation across the organisation to 30% and within senior management roles to 25% by December 2023.
Easter continued: "While we're confident we're doing all we can to increase ethnic minority representation across the business, our high retention rate, while positive, means we don't have vacancies at every level that can create real change.
"To address this, we continue to invest in our people, and provide specialist training and flexible working so all groups, regardless of background, are fully represented at all levels across the PPF. We're also working to change industry perceptions through the Diversity Project which is an initiative that champions a more inclusive culture in the savings and investment profession."
Pay and bonus gaps
The PPF also said its gender median bonus pay gap decreased from 31.02% in 2020 16.21%, and their gender median hourly rate of pay remained stable with a marginal increase of 0.15% to 15.86%.
Easter continued: "The marginal increase in our gender median hourly rate of pay is frustrating because our efforts to achieve gender parity have seen it narrow annually since we first started to report on it in 2017.
"We hope that by continuing to support initiatives that drive societal change like the Women in Finance Charter, and through nurturing our own female talent to become future leaders, we can remove our gender pay gap for good."
The PPF however did recognise its gender pay gap "hasn't narrowed nearly enough" - noting this was a reflection of the gender imbalances in both the pensions sector and wider society.
Easter added: "Pay gaps keep us focused on what we, as a society, value, and shines a light on the barriers some people face when they enter the workforce. While they don't always highlight the work organisations are doing to achieve pay equality which might take years to realise, reporting them makes us all accountable for driving positive organisational, sector and societal change."