Government contracts on the line if gender targets not met

“Targets are about accountability – both internal and external – and seeing meaningful progress over time.”

Targets could be numerical, such as reducing gender pay gaps or the composition of women and men in various roles, or “action-based”, such as introducing paid parental leave or improving workplace flexibility.

Employers could choose three targets from a “menu of options” expected to total about 20, and would have three years to achieve them, she said.

In the spotlight

Major technology and professional services firms that raked in billions of taxpayer dollars while having high gender pay gaps or low numbers of women among their staff could fall foul of the regime.

SAP Australia has entered government contracts worth $34.1 million since the start of 2023, most for the Digital Transformation Policy. Its pay gap was 16.2 per cent.

Microsoft signed government contracts worth $44.7 million over the same period, including a $17 million deal with the Digital Transformation Agency. Its total pay gap was at 9.7 per cent and two-thirds of its 2800-plus local staff were men.

Global strategy firms such as McKinsey, Bain and Boston Consulting Group had pay gaps far exceeding most professional services firms at 38 per cent, 31 per cent and 35 per cent respectively. McKinsey signed contracts worth $20.3 million with the government since the start of 2023 while BCG’s were worth $9.8 million.

Companies with relatively low gender pay gaps, such as Deloitte, PwC, KPMG and EY, would also need to show they were progressing on gender equality if they wanted to retain government contracts, which were worth a combined $1.2 billion last financial year.

BAE Systems had signed government contracts worth $930 million since the start of 2023. Its workforce was 80 per cent male, and last financial year 78 per cent of promotions and 73 per cent of appointments were men.

It currently has no policies to remove gender bias from pay reviews, implement transparent pay scales, make managers accountable for pay equity outcomes, or even to achieve gender pay equality.

Its total pay gap was 7.4 per cent, but women were disproportionately represented in its bottom pay quartile.

Progress key

Ms Wooldridge said employers would need to show progress on gender equality, even if they already had policies to support this.

“It’s not enough to say, ‘we’ve done parental leave – tick!’ It’s about new, improved, and progression.

“If your gender pay gap is 15 per cent, you might choose to have a target to get it to 10 per cent. If you don’t have parental leave, you need to add it. If you’ve got parental leave, it might be there’s a suite of enhancements that you then need to add.

“So it isn’t about incremental change. It’s actually about significant improvement and continuing the momentum.”

Companies’ progress would be monitored through WGEA’s annual census and included in the agency’s reports, which CEOs must give their boards.

Ms Wooldridge said WGEA was consulting employers about the targets.

A former Liberal politician and minister in Victoria, Ms Wooldridge also suggested her former party could benefit from quotas.

“The Liberal Party is actually not that different from all employers, and we’ve got very clear messages to all employers that this is a good thing to do. It’s not only a good thing socially, it’s a good thing economically, and you can translate that in a political context however you’d like.”