JSE open to talks on gender pay transparency

The Jamaica Stock Exchange (JSE) is open to discussions that could assist in the closing of the gender wage gap across the private sector, Managing Director Dr Marlene Street Forrest has said.

Those talks are expected to include a recommendation from the Caribbean Policy Research Institute (CAPRI) for the JSE to include in its governance index a mandate that publicly listed companies be required to make known their salary scales.

Street Forrest said the CAPRI report, which was published February 8, reveals “a worrying condition” that impacts economic development and social equality.

The CAPRI report, titled Fair Pay, concluded that women are poorer than men in Jamaica, with the purchasing power parity for female per capita income at US$6,729, compared to US$11,044 for males.

That means Jamaican women, on average, earn 61 cents for every dollar earned by men.

The report said that women are more likely to be in vulnerable forms of employment and less likely to be in leadership positions, situations that present a socio-economic disadvantage to women.

“As a stock exchange, we appreciate the impact that disclosure has in changing behaviour and positively improving outcome. Hence, we focus on matters such as timely and accurate disclosure requirements in general and our corporate governance index, which we believe can have a significant impact on matters that affect governance,” said Street Forrest in an emailed response to The Gleaner on Friday.

She said that gender pay inequality is a global concern and cuts across listed and unlisted companies.

Street Forrest said that the fix would be primarily legislative for a level playing field in compulsory action by companies - private or public, listed or unlisted.

“Notwithstanding, we appreciate that listed companies on the JSE are held to a higher standard of governance, and change, if started by these entities, could percolate to other companies.

“Consequently, the JSE is willing to initiate a discussion with the Private Sector Organization of Jamaica on this matter, to determine what steps can be taken to achieving the objective of reducing this disparity,” Street Forrest said.

At the same time, she said that the disclosure requirements for salary range, compensation, and remuneration of employees and directors was researched to determine the global standard.

That research included the rules of stock exchanges, the regulations of securities exchanges and financial commissions, corporate governance regulations, and other rules and standards.

The United States Securities and Exchange Commission, through federal securities law, require clear, concise, and understandable disclosure about compensation paid to CEOs, CFOs, and certain other high-ranking executive officers of public companies.

A company must disclose information concerning the amount and type of compensation paid to its chief executive officer, chief financial officer, and the three other most highly compensated executive officers. A company also must disclose the criteria used in reaching executive compensation decisions and the relationship between the company’s executive compensation practices and corporate performance.

For Hong Kong Exchanges and Clearing Market, an issuer must disclose in its financial statements details of directors’ and past directors’ emoluments, including the directors’ fees for the financial year; basic salaries, housing allowances, other allowances and benefits in kind; contributions to pension schemes; the bonuses paid or receivable by directors which are discretionary or are based on the listed issuer’s, the group’s or any member of the group’s performance.

There must also be disclosure on the amounts paid during the financial year or receivable by directors as an inducement to join or upon joining the listed issuer; the compensation paid during the financial year or receivable by directors or past directors for the loss of office as a director of any member of the group or of any other office in connection with the management of the affairs of any member of the group.

An issuer must also disclose in its financial statements information in respect of the five highest paid individuals during the financial year.

In France, the law requires that a remuneration report is enclosed in the company’s annual report of listed companies. The annual reports of listed companies should include a chapter, drafted with assistance from the compensation committee, relating to disclosure to the shareholders of the compensation collected by the corporate officers.

The Securities and Exchange Board of India requires that disclosures be made with respect to remuneration of directors, including salary, benefits, bonuses, stock options, and pension, among other things.

For Jamaica, the Corporate Governance Index Manual of the JSE evaluates listed companies based on the presentation of the remuneration of the board.

There are no disclosure requirements for salary range and compensation for employees of companies listed on the Nasdaq Stock Market in New York City, the London Stock Exchange, Australian Securities Exchange, Toronto Stock Exchange, and Canadian Securities Exchange.