WGEA released the Australia’s Gender Equality Scorecard (2023-24) on 20 November (See HERE). It is the first time data at the CEO and Head of Business level has been collected.

The gender pay gap at this level is 27.1%.

The executive pay gap makes a substantial impact on the overall gap. WGEA attributes a 0.7 percentage point increase in the average total remuneration pay gap of 21.8% to the inclusion of this senior level in reporting.

Guerdon Associates looked at ASX100 CEO appointments over the last 5 years. Of the 42 CEO appointments (excluding acting or interim CEOs) showed:

• Thirty-two were from a male to another male CEO;
• Eight were from a male to a female CEO;
• Two were from a female to a male CEO; and
• None were female to another female CEO.

Figure 1: TFR and Max TR Movements for ASX100 CEO Appointments 2020-2024

We found, on average, males succeeding male CEOs saw a reduction of 7.3% in contractual Total Fixed Remuneration (TFR), while females succeeding male CEOs had almost double the reduction (13.8%).

Male CEOs replacing female CEOs did so at the same rate of contractual TFR.

There were similar results when we looked at contractual Maximum Total Remuneration (excluding 2 extreme outliers). Males succeeding male CEOs saw a reduction of 8.0% in contractual Max TR, while females succeeding male CEOs had a reduction of 13.7%. Male CEOs replacing female CEOs did so at the same rate of contractual Max TR.

If males succeeding a male CEO are also being appointed at a reduced pay, it would appear gender is only part of the equation.

We looked at other variables that may influence remuneration such as whether the new CEO was an internal appointment, and whether they had prior experience as a CEO.

• Eighty-three percent were internal appointments (average 9-year tenure); and
• Twenty-nine percent had prior experience (average 5 years).

We also looked at whether company performance, as measured by TSR, was increasing or decreasing at the time of the appointment.

A simple analysis is found in the tables below:

Table 1: Average change in TFR for new CEOs

 

Table 2: Average change in Max TR for new CEOs*

* Excludes 2 extreme outliers.

Again, it appears as though an extra discount is applied if you are female.

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