It’s time for a private-sector sunshine law

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Public-sector employers are under more pressure from voters to even the odds for women and minorities; not so for the private sector. Their veil of secrecy needs to be lifted.

By Sheila Copps
First published in The Hill Times on March 1, 2021.

Kudos to The Globe and Mail for digging into the darker side of Bay Street’s dirty little secrets.

In a series on workforce gender bias last week, The Globe published confidential information on the remuneration of partners in one of Canada’s largest business law firms. At Cassels, Brock & Blackwell LLP, female equity partners earn almost 25 per cent less than their male counterparts.

Women are fewer in number, and women of colour are literally at the bottom of the pay grid.

That should not be surprising to anyone who looks at the corporate makeup of Bay Street.

What is surprising is how hard it is to identify discrimination because all law firms keep their business very private.

Inequality was even more glaring when it came to bonuses. According to an internal email leaked to The Globe, “over 80 per cent of men got a bonus, only 44 per cent of women did. Men took home 69 per cent of the total bonus pool given out to years one through seven.”

Despite the Globe’s efforts to dig deeper into the money trail at several other law firms, none was transparent with their partner payouts or employee numbers on gender imbalance, even after a two-year Globe investigation.

This journalistic investigation paralleled an internal review by the Canadian Bar Association prompted by a request from the Women Lawyers Forum, a branch of the association. The forum began by asking multiple law firms to reveal the details on partner compensation to verify or disprove the gender gap many women lawyers anecdotally identified.

According to The Globe “the majority of the firms were unwilling to release compensation amounts—even expressed as a percentage of total partner income. The final report was published last October with no information on the gender wage gap. The WLF could gather only some data on partner representation—the firms that participated had an average of 49 partners, 30 per cent of whom were women—and some insights into how firms determine compensation. Just 27 (unnamed) law firms out of 65 responded to the survey.”

The fact that more than half of the law firms refused to even respond to a survey from one of the branches of the Canadian Bar Association speaks volumes about the depth of the problem.

Sadly, one could move to most other Bay Street areas of business to find the same lack of commitment to gender equity or transparency. Only 24 (or about 3.5 per cent) of TSX-listed Canadian companies had a woman CEO as of July 2019. Women represented an average of 17.9 per cent of executive officers in S&P/TSX Composite Index companies as of December 2019.

According to the first ever Statistics Canada report on corporate boards and the gender gap, published in 2019, only 19.4 per cent of corporate board members in Canada are women.

The Globe series, by Robyn Doolittle and Chen Wang, took a deep dive into Canada’s gender inequality. Their first review involved the public sector, in a series published last month. In that review, the pair undertook an unprecedented analysis of public sector salary records, involving 90,000 employees across the federal, provincial, municipal ranks, and including Crown corporations, university and even liquor store remuneration practices.

The pair reported that “women aren’t only underrepresented at the apex of the public sector ladder, but on the many rungs below, as supervisers, managers, senior managers, directors, executive directors and vice-presidents, as well as deans and professors. In most cases, men made more than their female counterparts with the same title. Sometimes the difference was small—one or two per cent—but the gap steadily widened on the way to the top. (At publicly owned corporations, for example, women on executive teams made an average of nine per cent less than the male executives.)”

While still not equal, that appears to compare favourably with the mostly secret salaries of partners and juniors in the legal profession.

When it comes to the public sector, transparency has been the law of the land for decades. In Ontario, the so-called “sunshine list” has mandated the release of all public-sector salaries exceeding $100,000.

With transparency comes accountability. When executive salaries are released annually, it is easy to identify gender and diversity gaps in hiring and promotion.

Public-sector employers are under more pressure from voters to even the odds for women and minorities; not so for the private sector. Their veil of secrecy needs to be lifted.

It is time for a private-sector sunshine law.

Sheila Copps is a former Jean Chrétien-era cabinet minister and a former deputy prime minister. Follow her on Twitter at @Sheila_Copps.