gender pay gap

Gender Pay Gap Report 2020/2021

"At LV= we recognise the benefits of a diverse workforce and see it as an essential element in maintaining a competitive advantage."

Mark Hartigan, CEO

Gender Pay Gap report

"At LV= we recognise the benefits of a diverse workforce and see it as an essential element in maintaining a competitive advantage. Our core values are centered around Inclusivity and Diversity so it’s important to us that we create a business which holds an even gender balance year on year.

We are making progress and our mean gender pay gap decreased by 3.1% this year to 25.5%.

We had a target to reach 43% or above, female representation in senior roles by 2021, we hit 40.7%. Whilst we didn’t meet our target, we did have a positive shift of 1% increase on last year.

We know that this is just the start in seeing some really positive changes and we’re encouraged by the progress we’re making.

Closing the pay gap will require commitment and action over a number of years, we have an achievable target to continue to work towards over these years. I’m looking forward to seeing what we accomplish in the next 12 months” ~ Mark Hartigan, CEO

What is the gender pay gap?

All UK companies with at least 250 employees are legally required to report their gender pay gap on an annual basis.

This is a measure of the difference between the average pay of all males and all females across the whole organisation.

It is not the same as equal pay which deals with the pay difference between males and females who carry out the same jobs, jobs that are rated/graded the same, or work of equal value.
Equal pay means that males and females in the same employment performing equal work must receive equal pay.
The gender pay gap is different and measures the difference between the average earnings of males and females across an organisation (or the wider market).

Gender Pay vs Equal Pay diagram

Fair and equitable

We’re confident that pay at LV= is fair and equitable.

This is because we regularly review market pay benchmarks based on band, job and location against a large source of market data. We also continue to make improvements to our bonus and salary review processes to better ensure all employees are treated equally.

We share the ambition of the Government to see gender balance at all levels across financial services firms. As a diverse and inclusive employer it’s imperative we take steps to tackle our gender pay gap. We understand why we have a gap today, and we continue to take the steps we need in order to close the gap.
Read more on gender pay.

Our results

We’re encouraged to see our mean gender pay gap decrease by 3.1% this year to 25.5%. There is still a lot of work to do and we are committed to continuing to close the gap. Where we are seeing good progress is against our target for female representation in senior roles. We have set ourselves targets of having 33%, or above, female representation on our executive team and their direct reports and 43%, or above, representation at our senior bandings (Bands C-E.) You can read more about what we’re doing in order to reach this target in the “Gender Pay Gap – What Are We Doing?” section below.

	2019/20		2020/21
	Median	Mean	Median	Mean
Gender pay gap	27.8%	28.6%	25.17%	25.5%
Gender bonus pay gap	35.9%	48.2%	35.2%	48.4%

	2019/20		2020/21
	Median	Mean	Median	Mean
Gender pay gap	27.8%	28.6%	25.17%	25.5%
Gender bonus pay gap	35.9%	48.2%	35.2%	48.4%

Gender pay gap data

Understanding our gender pay gap data:

Mean - the average value of the data we’re using
Median - the middle value of the data we’re using when the data is ordered consecutively

When we compare with companies similar to LVFS we look at organisations who undertake insurance, reinsurance and pension funding, (except compulsory social security) activities
A positive mean / median value means that the average of all male salaries is higher than the average of all female salaries.

Structural gender balance between the pay quartiles

The quartiles represent our employees ranked by hourly rate from highest to lowest and evenly split into quartiles. We're confident that pay at LVFS is fair and equitable and we believe that our gender pay gap is largely a result of the structure of our workforce. We have a higher representation of males in the most senior roles and a higher representation of females in more junior roles – a position we would like to see change and one we are improving on in the upper range compared with 2019/20.

	2019/20		2020/21
Quartile	Female	Male	Female	Male
Upper	36.1%	63.9%	38%	62.0%
Upper Middle	51.5%	48.5%	48.1%	51.9%
Lower Middle	63.8%	36.2%	59.3%	40.7%
Lower	69.6%	30.4%	68.2%	31.8%

	2019/20		2020/21
Quartile	Female	Male	Female	Male
Upper	36.1%	63.9%	38%	62.0%
Upper Middle	51.5%	48.5%	48.1%	51.9%
Lower Middle	63.8%	36.2%	59.3%	40.7%
Lower	69.6%	30.4%	68.2%	31.8%

bonus payment

There is a -2.3% difference between the proportion of males and females who received a bonus.

This is in line with last year’s figures.

GENDER PAY GAP – WHAT ARE WE DOING?

How LVFS is tackling its gender pay gap

We believe fostering a diverse and inclusive culture is key to the successful delivery of our future strategy.

While we recognise that we need to continue our efforts on increasing the female population at senior levels within LV=, this is only one part of the equation.
Taking a broader view we also want to continue supporting all activities we can around Diversity & Inclusion to further foster an inclusive culture in order to bring about real change.

What's next?

We have an understanding of our gender pay gap and have identified a number of actions.

There are broad, complex and varied causes of the UK gender pay gap, and no short term solutions. We recognise that the measures we're taking to reduce our gender pay gap will need time to take effect before a meaningful impact is made. Please see the links below for more details on the targeted areas of activity.

Board diversity policy

LV= recognises and embraces the benefits of having a diverse Board. We see it as an essential element in maintaining a competitive advantage. A truly diverse Board will benefit from differences in the skills, regional and industry experience, education and professional background, race, gender, and other qualities of Directors. These differences are considered in determining the optimum composition of the Board and when possible should be balanced appropriately.

All Board appointments are made on merit and reflect the skills and experience the Board as a whole requires to be effective. The Corporate Governance and Nomination Committee (‘NomCo’) reviews and assesses Board composition and recommends the appointment of all new Directors to the Board.

In reviewing Board composition, NomCo considers the benefits of all aspects of diversity in order to maintain an appropriate range and balance of skills, experience and background on the Board. The Board supports ethnic and gender diversity and is aware of the Women in Finance charter target for women to represent 33% of Board membership and the Parker Review recommendation to have at least one non-white director by 2024. However, in identifying suitable candidates for appointment to the board, NomCo will consider candidates on merit against objective criteria as well as having due regard for the benefits of diversity on the Board.

As part of the annual performance evaluation of the effectiveness of the Board, Board Committees and individual Directors, NomCo will consider the balance of skills, experience, independence and knowledge on the Board and the diversity representation of the Board.

‘Inclusion’ is one of our four core values: For us being inclusive is all about embracing all contributions, valuing diverse opinions and making every voice heard

To bring about real change we believe focus is required on building inclusion, as well as diversity.

Actions speak louder than words and to be truly successful our values need to be ‘lived and breathed’ through the actions we take and how we operate as a business. Our values form a key part of our performance management process and evaluation. Our people are measured, rewarded and held accountable both on ‘what’ they deliver and ‘how’ they deliver.

Supporting our parents through the pandemic and working to develop inclusive flexible working good practice for all of our people

The Equality and Human Rights Commission has highlighted flexible working as its primary recommendation to improve gender equality in the workplace and tackle the gender pay gap.

We recognise that there is a huge demand for permanent roles that offer flexible working options, giving employees flexibility on where, when and the hours they work. At LVFS many of our people benefit from fixed and non-fixed flexible working patterns.

The pandemic has shone a spotlight on the importance of flexible working particularly for our parents who have been balancing childcare, home schooling, caring, home and work responsibilities. With the majority of our population working from home during the pandemic, we have seen that flexibility and work life balance is both really important for our people’s wellbeing and their productivity more generally. Consequently, we are now exploring the use of hybrid working for the majority of our population. Whilst we believe that some team collaboration in the office is important for many roles, we want people to feel empowered to request individual working schedules that enable them to maximise their work life balance.

As part of our commitment to ensure equal opportunities and support for all employees to advance their careers, we have developed a number of initiatives and a targeted development program for senior women

Specific initiatives in the last year include:

We have started a female senior leader workshop series aiming to help our leaders to build their career narrative and personal brand, as well as exploring resilience and how employees can thrive.
We offer coaching and workshops aimed at maternity, paternity and adoption returns as we are aware it is a critical period for new parents, and if the right support and communication isn’t given during this time then it could seriously impact career ambition and development. We spent time running focus groups with our maternity returners, to enhance the parental journey.
We offer support focus groups open to any woman wanting to discuss any menopause based issues, because we are conscious that during this time of life a woman can experience difficult and uncomfortable situations, and it can be experienced over many years. We hope that by having these open focus groups, it makes menopause less of a taboo subject and therefore people experiencing it feel less isolated.

Listening and responding to the challenges faced by our women through COVID-19

There is growing evidence of the potentially disproportionately negative impact of COVID-19 on women. We used our engagement survey both in 2020 and 2021 to really listen to the experiences of all our colleagues, and specifically the females within our business.

As a result of the feedback we launched a ‘Calm amongst the chaos’ coaching programme and a series of expert led parental webinars. While these were open to all, they were designed in response to female specific feedback and insight from our gender network.

The webinars were held over the course of 2020 and 2021 and designed to support parents during this challenging time to balance home-schooling, working, caring and managing the home. The webinars provided very practical guidance on a number of issues including mental health, school holidays, work life balance, how to manage conflict and address feelings like guilt and pressure and much more. We received excellent feedback – people were able to make real changes leading to better family and work outcomes, as well as build connections across our internal community.

We also ran a number of virtual ‘Calm amongst the chaos’ coaching programme cohorts. This programme was built to address what can be overwhelming feelings and build personal resilience enabling participants to find more energy to achieve what’s important to them, pursue their career ambitions and harmonise work and home.

Supported by the HM Treasury Women in Finance Charter these awards are Europe's largest diversity initiative in the Finance sector, recognising the high-achievers, advocates, and role models for women in the industry.

We have supported and sponsored these awards since they launched in 2017. In 2021 we were thrilled to have two shortlisted nominations of our own: Georgina Farrell, CAO, in Insurance Leader of the year category and Lisa Stroud, Lead Finance Manager in Accountant of the year category.

Women in finance

Women in Finance Charter (WIFC)

Signing up to the Women in Finance charter in 2016 is another way we’ve shown our commitment to supporting gender diversity. This includes our executive team and board-endorsed commitment to increase the proportion of women in senior positions.

We had a target to reach 43% or above, female representation in senior roles by 2021, we hit 40.7% so whilst we didn’t meet our target, we did have a positive shift of 1% increase on last year. As a business we have been through a period of significant change over the last 12 months, so overall we are satisfied with this increase and see us moving a positive direction over the next 12 months.

Experience of developing female talent pipelines shows us that we will change our organisation ‘one appointment at a time’, and our success has been driven by a number of factors including our leadership teams’ commitment and sponsorship. An increase in female representation in our senior roles will support a reduction in our gender pay gap. We know that this is just the start to some really positive changes and we’re encouraged by the progress we’ve made.

WIFC commitments:

We have an objective to achieving 43%, or above, female representation at senior levels by the end of 2021.
We’ll annually publish our progress against our targets.
A member of our executive team is responsible and accountable for gender diversity and inclusion.
These targets are embedded in our executive teams’ performance plans and performance against these aspirational targets will be directly linked to performance-related pay.

As LVFS has a population of circa 1300 employees it can be heavily impacted by minor role changes. We'll continue to focus our efforts on taking action to improve our gender balance especially at senior management, where progress is still required. By setting targets and taking action we're moving closer towards gender balance.
We want to make sure that the skills and capabilities of the entire workforce are recognised and nurtured. This is about levelling the playing field where everyone can succeed on merit.