Strategic report Governance Financial statements Other information ANNUAL STATEMENT BY THE CHAIR OF THE REMUNERATION COMMITTEE CONTINUED •Throughout the pandemic, we have focused on doing the right Gender pay and diversity •The important role that our colleague networks play in driving thing for our clients, colleagues, community and shareholders At HL, we believe in building a diverse and inclusive workforce engagement and awareness; and it is appropriate that we also do the right thing for our not just because it is the right thing to do but because it is good for Inclusive behaviour sessions to support colleagues in achieving Executive Directors. Having recognised their continued our clients, our business and our people. One of the five pillars of • excellent delivery over a sustained period of time against our strategy is to develop a diverse and inclusive culture where their colleague culture objective; personal and business objectives, the Committee, having colleagues are engaged, empowered, work together and live our •A review of Board and Committee membership which has considered shareholder feedback, has approved salary increases values. In 2020 all colleagues were given a goal aligned to this pillar, significantly reduced the number of all-male Committees and in line with our wider workforce approach. The increases ensure encouraging everyone to take personal responsibility for building provided more diverse voices across our governance fora; we are able to appropriately motivate and recognise continued an inclusive culture at HL. strong performance in an increasingly competitive market •Updating employee policies to continue to ensure we support landscape where this business has significantly increased in scale Our inclusion and diversity strategy has three priority areas and a diverse workforce, including the introduction of a new and complexity over the course of their tenure. The Committee an aligned action plan to drive progress. The intended outcome is menopause and menstruation policy; and has decided to award the CEO a two-stage salary increase of 8% that we build an inclusive culture and brand where colleagues feel The launch of a sponsorship programme for female and ethnic engaged, and we are able to attract a broad pool of talent. Inclusion • for 2021/22 and 4.3% for 2022/23. For the CFO, it was agreed that and diversity is considered against progression and retention of minority talent. he will receive a salary increase of 6.8% for 2021/22. Although female and ethnic minority talent at HL and we continue to build Philip Johnson has since announced his desire to step down from Our 2020 gender pay gap figures show that we reduced our Median his position, I would like to clarify that the salary increases relate accountability into our approach through setting inclusion and Gender Pay Gap, Mean Bonus Gap and Median Bonus Gap since to the Executive Director roles and, as such, we continue to diversity objectives with target metrics for Executive Directors, 2019. Our Mean Gender Pay Gap has increased year on year moving believe it is right to ensure they are positioned appropriately. Executive Committee members and senior leaders, and also from 12.9% in April 2019 to 17.6% in April 2020. However, this was These increases are greater than the average salary increase through the regular tracking of progress at the Executive primarily because at the snapshot date there was an increase in percentage but are in line with our wider workforce approach Committee. In 2020/21 Executive Directors’ objectives included the proportion of men at the most senior levels of the organisation where we apply a salary increase range depending upon quantitative gender targets at a Group-wide level. In 2021/22 this including the Board, which had a significant impact on the mean individual performance and market positioning. will be broadened to include ethnicity targets. hourly pay rate. We have already seen this trend reverse for 2021, In the past year, we have revised our strategy to increase the focus given increases in female representation at Board and Director Further details are set out on page 109 to 111. on female and ethnic minority representation, alongside inclusion. level as a result of our strategic focus on hiring more, promoting Regulatory developments Some clear successes to date include: more and losing fewer senior women. The Board and executive team recognise the importance of being 72% of colleagues surveyed feel that HL values and promotes We have supported the attraction, retention and progression able to demonstrate to shareholders and regulators that our • of diverse talent through several external partnerships remuneration policy encourages the right behaviours to deliver employee diversity, with only 7% of colleagues responding and engagements: long term sustainable business performance and good client unfavourably to this question; outcomes. Although significantly aligned already to reflect Exceeding our Women in Finance Charter target of 25-30% senior •Our ongoing participation in the 30% Club’s Women Ahead • Mentoring programme; upcoming regulatory changes in the Investment Firm Prudential female representation, reporting 30.4% in this year’s submission; Regime, we will implement these requirements in line with the Signing up to the Race at Work Charter to show our •Nominating colleagues to participate in the Stepping Up required timeframes. • programme, an award-winning diversity leadership programme commitment to ensuring ethnic minority employee targeting people from ethnic minority groups, women and representation at all levels; people with disabiliti es; 90 Hargreaves Lansdown Report and Financial Statements 2021