Show Women The Money
11 August 2023
Image credits: FIFA Official Website
The Women’s World Cup has put pay equity in the spotlight. For many ethical investors and ethical funds ‘equal pay’ is one of their top concerns. So, it is timely to consider the gender wage gap problem and how the Women’s World Cup highlights problems and solutions.
Against a backdrop of FIFA’s history of ethical malpractice, FIFA has been aiming to transform itself to become an exemplar of business ethics and positive impact with a commitment to using “football’s power as a force for good” including in tackling its own and the world’s gender equality problem.
After undertaking a sustainability report, FIFA identified that equal pay was a key issue stakeholders wanted them to take action on. Furthermore, FIFA faced criticism about not paying men and women equally during the respective World Cups. In response, FIFA has joined forces with UN Women to use the spotlight of the 2023 Women’s World Cup in a call for all of us to take action to “Unite for Gender Equality”, to “realise gender equality as a fundamental human right and as critical for a peaceful and sustainable world”. Calls to action on gender equality are being promoted via the team captains’ armbands, pitch side digital LED boards, large flags presented on the pitch, giant screens in stadiums, and via social media.
Many ethical investors believe that supporting ‘equal pay for equal work’ not only aligns with their values but also aligns with the principles of fairness, diversity, and inclusivity that underpin a just society. If you share this concern, it is timely to take your own action of telling your investment adviser that this is one of your goals. Including a ‘gender lens’ is a key part of wise investing – you may improve financial return and also improve the lives of women.
The Problem
A global wage report on the gender wage gap by the United Nations' (UN) International Labour Organization (ILO) found when analyzing data gathered from 70 countries that in 2018-19 women earned, on average, only about 80% of what men earn for doing the same jobs. A study for 2022-23 of a more limited sample comprising 22 countries noted that there was very little change in the gender pay gap. Highlighting the gap, women in health care earn 24% less than men and those in agriculture only earn 82 cents for every dollar earned by men .
In New Zealand the MindTheGap initiative highlights that “In 49 years, the Equal Pay Act has not closed our pay gaps”. Based on the Stats NZ, Household Labour Force Survey 2021 they report that for every $1.00 a Pākehā man earns a Pākehā woman earns $0.89, an Asian woman earns $0.83, a Māori woman earns $0.81 and a Pasifika woman earns $0.75.
Compounding the pay gap problem, women have been among the worst affected by the COVID-19 pandemic, including in terms of their income security, disproportionate representation in some hardest-hit sectors, and the unequal and gendered division of family responsibilities. The ILO has highlighted that these factors negatively affected women’s employment, threatening to reverse decades of progress made towards gender equality. For example, during the pandemic, working women in the USA suffered greater job losses compared to men.
The Women’s World Cup Highlights Problems and Solutions
The 2023 Women’s World Cup tournament is expected to be seen by more than two billion people—the largest audience in history for a women’s sporting event. “This is a historic opportunity to draw the world’s attention to critical issues facing women on and off the pitch,” said Simone Clarke CEO UN Women Australia. “We know that women face significant barriers to equality, often under supported in their professional development and sidelined in their career progression, excluding women from opportunities others take for granted. This campaign provides a powerful platform to promote access and inclusion for all women, in the hope that one day we will have a truly level playing field for every woman, and gender equality for all.”
In seeking to do more to walk their talk, FIFA raised the prize money for the 2023 Women’s World Cup to US$110 million (NZD $182 million). This is more than triple the amount in 2019, when the prize money for the tournament was doubled to US$30 million ($49 million). However, progress has been slow - the first World Cup to award prize money to women was in 2007 – 25 years after the men and the prize money for the men’s 2022 World Cup in Qatar was US$440 million (NZ$728.6 million).
FIFA President Gianni Infantino has attributed the current shortfall to broadcaster payments. He criticised broadcasters saying: "You pay us 100 times less, whereby your viewing figures are very similar, maybe 20-25 percent less for the women than for the men," he said. "Not 100 times less, 20 percent less."
Most of FIFA’s revenue comes from organizing and marketing major international competitions, with the most popular being the Men’s and Women’s World Cup, each of which happens every four years. In 2022, FIFA had revenues of over US $5.8 billion, ending the 2019–2022 cycle with a net positive of US$1.2 billion, and had cash reserves of over US$3.9 billion. Critics argue that with these financial resources, equal pay ought to have happened by now.
FIFA has set a target of equal prize money for men and women at their next World Cups in 2026 and 2027, respectively. Critics are wary that this target may not be met.
A Global Battle
The fight for equal pay in the women's game has extended beyond FIFA itself. In February 2022, the United States women's national team settled its legal dispute with U.S. Soccer. As part of the agreement, the federation committed to paying the men's and women's teams equally moving forward. Four years ago, chants of “equal play, equal pay” echoed around the stadium as the US Women National Team lifted the World Cup trophy. Carli Lloyd, one of the five players who filed a claim for wage discrimination in 2016 said: “For six years, we had been in this fight and nobody wants to be fighting with their employer,” she added. “[But] long gone were the days of thinking that we just need to accept what’s given to us. So it was our duty to fight and to make the sport better … just like all the players before us had done.”
In 2018 New Zealand football made world headlines by negotiating a Collective Bargaining agreement at a national level that gave the Football Ferns parity with their All Whites counterparts. This included pay parity, equal prize money, equal rights for image use and parity across travel while representing New Zealand. The NZ Herald reported that this was believed to be a world first for football, with no other country among FIFA member nations striking such an all-inclusive agreement for its national teams.
Looking beyond national teams, the pay gap is most extreme in the difference between the men’s and women’s teams based on the salary from the football clubs they play for. The country with the biggest gender pay gap in terms of average team salary, according to Oddspedia research, is England with an astronomical gap of -2,425 per cent. While the men’s World Cup team has an average team salary of $13,456,420, the women’s World Cup team – prior to the tournament considered the second favourites to win – takes home individual salaries of $532,959.
The standard argument is that female athletes are paid less than men because they generate less money. For example, England men’s national football team manager Gareth Southgate has said: “I have a daughter and if she is in an office and she is doing the same job as the person next to her then I would want her to be paid equally. There is no doubt about that. I think that if men and women are doing the same job and men are being paid more than that’s an aspect that can’t be right”. He says that aspect is the economics of men’s football generating vastly more broadcasting and sponsorship.
According to USA commentator Anya Alvarez, a former professional on the LPGA, men’s sports will always earn higher revenue if women’s sports aren’t marketed properly. She maintains: “There is systematic sexism in sports that leads to unequal pay, which starts with how women are marketed by their own leagues. Let’s look at the WNBA (Women's National Basketball Association) whose marketing budget makes it difficult to build a fanbase – and therefore revenue – to support its athletes. As Washington Mystics player Elena Delle Donne said last year: “We absolutely do not get promoted as our male counterparts do. Yes, I’m talking about the NBA. When you put millions of dollars into marketing athletes and allowing fans to get to know a player they develop a connection with someone or something you are more engaged with and continue to want to see/learn more. How is anyone going to get to know me or any of my colleagues if we aren’t marketed as much?”
Changing Mindsets
For all the practical barriers to gender equality in soccer, it is “sexist attitudes” and “shifting the attitudinal barriers that’s the toughest,” former executive director of Women’s Soccer Australia Heather Reid told CNN Sport. Similarly, Football Ferns captain Ali Riley, said “I think it’s a mindset. It’s tradition”.
Until relatively recently, women were not even able to play soccer in several countries around the world. It was “quite unsuitable for females,” an English Football Association (FA) minute book said in 1921, and the organisation banned women from playing at its clubs until 1971. The French Football Federation only recognized women’s soccer in 1970, and the Royal Belgium Football Association a year later.
An article in Global Citizen concludes that we need : “Investment from sports entities in recognizing and celebrating women's skill and sporting excellence; investment from the private sector in ensuring brilliant women are getting into leadership; investment from governments in equity for women in health care, in education, and more. The answer is: show women the money”. After all, as McKinsey eloquently put it, “What is good for gender equality is good for the economy and society as well.”
Concluding on Positive Notes: From a ‘She-cession’ to a ‘She-boom’
During the pandemic, working women in the USA suffered greater job losses compared to men. However, in positive news reported recently, the number of women in the workforce has outpaced pre-pandemic levels and the pay gap has narrowed.
The pay gap between full-time working women and their male counterparts in the US is now narrower than ever, according to data from the Bureau of Labor Statistics. Women are now making 84 cents for every $1 that men earn for similar work – the closest it’s ever been. Julia Pollak, chief economist at ZipRecruiter, told news site Axios, “What was a ‘she-cession’ in some ways appears to be turning into a ‘she-boom.’”
Meanwhile, Barbie, Beyoncé, and Taylor Swift are being hailed as the “bosses of the boost” with some in the USA describing this as the “she-economy”. For example, NBC reported in this fun video that “Experts say spending is up nationwide this summer, thanks in large part to those three”. The video includes an extract from the Philadelphia Federal Reserve report highlighting Taylor Swift's three-night stop as a boost to the local economy.
Media coverage of Swift’s effect on local economies has prompted jokes that the singer is single-handedly saving the U.S. from a recession. However, economist Misty Heggeness says it’s time to reframe that story. “The moment that we’re in right now — which I cheekily term Swiftynomics — is not specifically a story about Taylor Swift,” she said. “It’s a story about women’s acceleration of economic power.”
Reflecting on the ‘she-boom’ and the Barbie movie, that has now passed over $1 billion at the box office, Allison Robinson writing in Forbes concludes: “While we’re not yet ready to take a victory lap, we’re cautiously optimistic about the state of women in the real world. The first step toward progress is awareness, and companies, families, and individuals have recognized the need to achieve higher levels of equality between women and their male counterparts. Before we can truly celebrate, we need to focus our attention on gaining faster, more systemic progress for women in terms of their pay, their leadership opportunities, and their domestic responsibilities”. Amen to that!