Norway, known for its stunning wilderness, has managed to reduce its gender pay gap to 14.3%, two percentage points lower than the EU average. How did the Scandinavian nation do it, and what will be done to close the gap entirely? And what lessons can be imparted to the rest of the world?
Awake and alert under the midnight sun
Famously, the Nordic countries have made strides toward gender equality, boasting long periods of paid parental leave, highly subsidized childcare, and legislation of both pay equity and pay transparency. Norway, along with nearly all of its Scandinavian neighbors, is among the top ten countries in the world with the smallest gender gap, according to the World Economic Forum’s 2018 ranking.
Employment rates are also nearing gender parity. The Nordic Labour Journal estimates that three out of four women participate in the workforce and make up 40% of the boardrooms of the 500 largest firms, 175 of which are publicly traded on the Oslo bourse. What’s more, of the 195,000 managers in private firms, 35% of them are women, up from 30% in 2014. And in public administration? 52% of managerial positions are held by women. All encouraging signposts along the journey towards fair pay!
Marking the path…
The progress made in Norway is partly due to its impressive history with pay transparency. Legislation dating all the way back to 1814 stipulates the logging and publication of each individual’s income, assets, and the amount they paid in taxes. This information has been available to the public since the policy has been in place, and has been accessible online since 2001. Such radical pay transparency sets the stage for fair pay. Individuals are able to check what their colleagues made without having to file any requests or make any inquiries. This allows for more honest and frank conversations on a societal basis about money, wage equity, and fair pay.
165 years later, the Gender Equality and Prohibition of Discrimination Act set the legislative foundation for pay equity and provided companies with more than 50 staff with the impetus to fully embrace fair pay and pay transparency. Annual reports on the status of equality within such companies as well as in public sector employers must be submitted. If obstacles are identified, measures are found to contribute to greater equality and diversity within the enterprise.
Employees may also request the employer the amount of salary and the criteria for determining the salary of the person or persons with whom they are compared.
… that we may follow!
In 2003, Norway blazed more trails when it became the first country in the world to legislate for gender parity of the boards of public limited companies, state, and municipality-owned companies, as well as cooperative companies. Companies were given four years to diversify their boardrooms and were given support in the form of databases where they could find new talent, as well as the “female Future” training program that they could send their employees to.
The Norwegian case demonstrates that legislative tools are instrumental to achieving a gender pay gap of zero. As women increasingly enter positions of leadership, the winds of change will become even stronger. With a little help from policy, fair pay is just around the corner.
FPI - What we do
Why does the gender pay gap prove so intractable? What is standing in the way of fair pay for all? What do companies need to do in order to put sustainable pay strategies into practice?
Knowing about the pay gap and being willing to rid the world of the unjust state of affairs are evidently not enough to actually ensure fair pay. It is right here ...