The 2022 WTW Global Gender Wealth Equity report showed that on average women are expected to reach retirement with just 74 percent of the wealth accumulated by men.
In Asia Pacific (Apac), women are expected to accumulate just over three-quarters (76 percent) of men’s wealth levels, two points above the global average.
The study highlights that the gender wealth gap at retirement increases with seniority.
Globally, women in senior expert and leadership roles were found to have less than two-thirds (62 percent) of the accumulated wealth that their male counterparts enjoyed at retirement. For mid-level professional and technical roles, the gap was still substantial at 69 percent, but it narrowed considerably to 89 percent for frontline operational roles.
Within Apac, the findings show considerable differences in expected wealth accumulation at retirement and progress made towards gender wealth equity across the region.
Across the 12 markets in the region, the gender wealth gaps range from 64 percent in India to 90 percent in South Korea.
Six markets included in the analysis have a higher wealth index at retirement for women compared to the global average, and among them are China (78 percent), Japan (82 percent), Philippines (79 percent) and Singapore (79 percent).
In Apac, the gender wealth gap is the largest in India at 64 percent.
The study found that one of the contributing factors for this can be the significant gender pay gaps in the country, which exceed the global average, particularly for professional and technical roles.
Opportunities for women in leadership positions are also limited, with only three percent of women in the workforce occupying senior positions. Women also tend to assume childcare responsibilities at a young age, resulting in financial impacts from which there is limited capacity to cover. Compounding this is the fact that long-term financial decisions generally rest with men and financial literacy for working women tends to be lower.
Manjit Basi, senior director, Integrated and Global Solutions, WTW, said: “The results from our global analysis are startling. It shows that there is a gender wealth gap consistently across the 39 countries that we studied. The primary drivers contributing to gender-based wealth disparity include gender pay gaps and delayed career trajectories. Additionally, gaps in financial literacy and family caregiving responsibilities outside the workplace influence women’s participation in paid employment and therefore their ability to build wealth.”
“Given the variety of cultures, traditions and differences in the relative prosperity and social equality across the region, it’s unsurprising that the results are mixed. However, wealth equity for women in senior expert and leadership roles remains a particular challenge for Asia. It’s imperative that activities around gender diversity, equity and inclusion broaden to look at economic wealth at the end of women’s working careers. Pay is a fundamental factor that underlies the gender wealth gap and while addressing the gender pay gap will partially close the wealth gap, it won’t eliminate it entirely,” said Clare Muhiudeen, head of Asia, WTW.
The study highlighted that there has been an increasing focus on reversing the trend of gender discrimination through the recent environmental, social and governance awakening.
In addition, corporate efforts to further diversity, equity and inclusion have helped narrow the gender pay gap and underrepresentation of women in board and leadership roles. Yet there remains more to be done.
“Gender inequity in wealth accumulation is under-researched and overlooked. The reality is that the wealth inequity issue and its causes and effects are multidimensional and should be studied and addressed as such,” added Basi. “By focusing on accumulated wealth at retirement, the disparity can be quantified, and actions can be taken through broader society, government and organisations to equalize wealth outcomes.”
“This is a clear opportunity for corporations to differentiate themselves as progressive employers by taking action to support the equalisation of gender wealth accumulation.”
The WTW Global Gender Wealth Equity report follows a collaboration between the World Economic Forum and WTW earlier this year which released initial insights into the wealth gap in its Global Gender Gap Report. (PR)