Bonuses for bank executives to be linked to number of women bosses

A charter linking pay bonuses for top city executives to the appointment of senior women was signed Tuesday at the Bank of England in London.

Leading banks have agreed to sign up to a new government charter designed to improve gender diversity in senior positions in the banking sector.

The charter sets out how the recommendations of a review undertaken by Jayne-Anne Gadhia, CEO of Virgin Money, will be implemented.

The Gadhia review wants financial service firms to link parts of their remuneration packages of their executive teams to gender balance targets.

It also recommends that firms set internal targets for gender diversity in their senior management, publish progress reports annually, and appoint an executive solely responsible for gender, diversity and inclusion.

A Treasury spokesman said: "The government strongly believes these recommendations will be key to driving changes in the senior levels of the male-dominated financial services industry and has launched a new 'Women in finance charter' today committing to take on board these recommendations."

Gadhia will be the first bank chief to sign the charter on behalf of Virgin Money. She will be joined by representatives of four of the sector's largest employers, Lloyds Banking Group, Barclays, HSBC and the Royal Bank of Scotland who will pledge their commitment to improving gender diversity in their firms.

The Treasury will publish a list of the firms who have signed up to the charter after three months.

Harriett Baldwin, economic secretary to the Treasury, said: "Achieving gender balance at all levels across financial services firms is a personal priority of mine. It is fantastic that a number of leading banks have already committed to sign up to our new 'Women in finance charter' and I encourage all firms across the sector to follow suit."

"Removing the barriers which prevent women from fully realizing their potential in the labor market is a crucial part of improving the UK's long-term economic performance," said the official.

The Gadhia review looked at the issue of unequal gender representation in financial services and found that in British financial services, female representation was around 23 percent on boards, but only 14 percent on executive committees.

Gadhia said the objective of the review was to understand what more could be done to get more women into senior leadership positions.

She said: "Too few women get to the top and this is not just about childcare. Women are leaving because the culture isn't right. It's very encouraging that a number of major financial services companies have already agreed to implement our recommendations." Endit