Ask most UK business heads – or indeed anyone who reads the newspaper – whether women managers are paid equally to men, and you‘ll be told that the country’s much-discussed gender pay gap reaches right up to the top. But new research from Philipp Geiler  of EMLYON and Prof. Luc Renneboog has revealed that female CEOs in the UK actually face little fiscal discrimination, with no discernible differences in base salary between genders in the very top positions.


Despite this, ‘Are female top managers really paid less?’ a paper that examines the nature of top tier pay across all UK listed companies, has exposed that there is very real gender discrimination in the salaries of other female executive directors (e.g. CFO, COO, Deputy CEO, etc). In fact, female top managers below CEO level earn about 23% less than their male counterparts, which amounts to roughly £1.3 million over a five year period (the average tenure as an executive at board level).

However, there are two scenarios which make it much more likely for a company to exhibit a smaller pay gap: if the firm already has female non-executive directors on the board or in typically “male” industries such as tech, science and IT.

 The nature of bonuses

Interestingly, this gender divide is also reflected in bonuses. Where male CEOs’ pay is strongly performance dependent, top women leaders’ remuneration is focused more around both accounting and market-based performance. Similarly, her bonus is not solely based on company performance as would be in the case of a male leader, but also on the perception of her charisma and leadership ability (Kulich et al. 2007). Yet for female executive directors who are not CEO, the story is slightly different. Geiler and Renneboog’s research demonstrates that these positions, though key within a company, receive a 15% lower salary and 20% lower bonus on average, which translates respectively into about £20k and £25k less pay than if a man were filling the roles.

 Business and parenthood interplay

One prominent topic in the pay equality debate has been that of parenthood – can a business invest so wholly in an individual where there is a risk of losing them for significant amounts of time? Prolonged absence of senior figures can be highly damaging to a company’s competitive performance.

American professors Michelle Budig and Paula England found that the impact of parenthood depends on the number of children a person in leadership has, and that each additional child is associated with a 2–7% reduction in women’s wages. It is no surprise, then, that highly skilled women often postpone motherhood to reduce its impact on her career. Yet even for those women who do not start a family, their pay can be as much as 9% lower than males’ even before the birth of their first child (Lundberg and Rose, 2000).

Interestingly, there are also studies that examine why marriage can have a positive effect on a male’s labour market outcome. This is generally because of an increased domestic emotional support network and heightened job-related motivation, as well as the changed perception of the husband as more stable and responsible (Cohen and Haberfeld, 1991). Whether or not this is entirely plausible is irrelevant in this case as what is more telling of the perception of gender in leadership is that there are no studies examining the role of a male spouse on career success of female managers.

 CEO above monetary discrimination

Nonetheless, the CEO operates above monetary discrimination – and this rings true of both genders, with marginal difference in salaries being recorded. Yet in all listed UK companies, only 2% of CEOs and 4% of executive directors are female. Perhaps, then, it is the road to female leadership itself that is paved with inequality, and that gender parity in remuneration has (nearly) been reached – but only for those who have climbed to the very top.

Philipp Geiler

I am Assistant Professor in Corporate Finance. Prior to joining emlyon business school, I was a researcher at Tilburg University. I was also a visiting scholar at Oxford University and worked for an international consulting firm. I have published in the Journal of Corporate Finance, Corporate Governance: An International Review, the Journal of International Financial Markets, Institutions & Money, and others. My research interests are corporate finance, corporate governance, and executive compensation.

More information on Philipp Geiler:
• His CV online
His ResearchGate page

Further reading…

  • Geiler, Philipp, Renneboog, Luc, 2015. Are Female Top Managers Really Paid Less? Journal of Corporate Finance, 35, 345-369.
    View abstract
  • Budig, Michelle J., England, Paula, 2001. The wage penalty for motherhood. American Sociological Review 66 (2), 204–225.
    View abstract
  • Cohen, Yinon, Haberfeld, Yitchak, 1991. Why do married men earn more than unmarried men? Social Science Research 20, 29–44.
    View abstract
  • Lundberg, Shelly, Rose, Elaina, 2000. Parenthood and the earnings of married men and women. Labour Economics 7, 689–710.
    View abstract

See also the International Women’s Day website