Hi, my name is Lea Lonsted. I am pay equity leader covering Europe and UK for Mercer. I'm here with our new partner Henrike von Platen who is founder and CEO of Fair Pay Innovation Lab, a Germany-based NGO with a very important mission in life. Henrike, can you please share a bit more about your mission
Well, our mission is very short and beautiful, it says fair pay for all. And to broaden it up a bit, of course, that means all human beings should be paid fairly worldwide. So it's quite a broad goal that we have at this point. And, well, that's I would say-- I wouldn't want to make it deeper at this point.
So why would companies want to certify their pay equity efforts.
Well, most of the times what companies want to do is they want to show where they stand to the rest of the world. But for that they need to be sure that where they actually stand. And a certification is something that gives them the possibility to have it checked by the outside and not to just say, OK, we're paying good, and even employees sometimes don't believe it.
So the reason that they want to do is to be sure that a third-party has done it. And then they get the certification mark, and with that also use it as an employer branding tool, which is what I hear most of the time. But you have far more clients than we have in this sense of working doing analysis and all the steps that are inside the certification. For me, it would be interesting to know what your clients are actually saying to this question.
Thank you, Henrike. I mean, our clients, they are already benefiting from a very detailed and unbiased regression analysis, which is done by Mercer. And this analysis identifies the unexplained pay gaps as well as the root causes behind inequities. So you could say they already have the knowledge.
But those who then take the next steps of being certified through FPI are often companies that want to disclose their gaps to both internal and external talent and to a broader set of external stakeholders and potentially investors as well and thereby show a greater amount and degree of transparency when it comes to both pay and fairness in their organizations.
So I'm wondering why do you think it's urgent now with a certification?
It's urgent for a long time. It's overdue. So it should be done. But there's one big reason, which I think is very important, the urgency wise, and that is everybody would probably know about the SDGs. And there are 17 of them and it's the Agenda 2030, which means in 2030. We're 2023 now. We have seven years to finish that.
We know from lots of studies from the UN and your women that the goal is 5 or 8.5, all concerning the fair pay and equality parts have to be finished before lots of the others can be finished because they're so interlinked, which means it leaves us with two or three years to actually get this topic done and make sure everybody is paid fairly.
And, therefore, by being certified it would prove that, to really make sure that by 2030, we live not only in a fair world but on the planet that we want. So that's the main urgency that I see. And surely there's a lot, which I would like to know from you, with EU legislation and stuff like that. Maybe you can give me a shot on how do you see the legislation part because that is a big one as well.
Yeah, exactly. I mean, the most recent, the newly approved EU directive on equal pay and pay transparency definitely puts pressure on organizations with activities in Europe. But we also have increasing transparency legislation in the US, with several states promoting this now. So it really pushes companies to both get their foundation in place and do it with urgency.
But that's another aspect as well, which is the scarcity of talent that plays in and how do we attract and retain Gen Z, younger generations coming into the workforce. They're really pushing for transparency and for fairness and to some degree not disclosing can actually raise concerns of whether there's something to hide.
Yeah, especially the younger generation. I see that too. And I would actually like to say at this point going to the young ones, going to the employees and looking at all that, what everybody should just do is analyze where you stand. It's something you want to know, anyway. Develop the measures to get better because you will probably find out something. And you want to improve.
And then just make sure to become a real leader by actually sharing the best practice that you have found and that you have developed. And make sure that others can learn from what you've done on your journey to reach planet fair.
Excellent. That's a wonderful call for action. Thank you so much, Henrike.
Thank you, Lea.