Investment banks must be more transparent about the methods they use to calculate bonuses if they are to avoid further headline-grabbing accusations of sex discrimination, industry experts say.
The investment banking industry is famous for the multi-million dollar bonuses awarded to high-performing bankers, but secrecy over how much is doled out to individuals can hide big pay differentials.
"There is no clear and open process, leaving managers with a large degree of control, and it's where that control is used in an inappropriate way that banks get bitten," said Jill Andrew, who specialises in sex discrimination cases at law firm Archon.
"We get very busy when bonuses are declared," she added.
Banks have been hit by a number of sex discrimination claims.
Former Merrill Lynch banker Stephanie Villalba for example is seeking a record 7.5 million pounds ($13.9 million) from her ex-employer for sex discrimination that allegedly meant she was being paid less than male colleagues.
Julie Bower, a former Schroder Securities analyst, won 1.4 million pounds compensation after showing she had been awarded a 25,000 pounds bonus at the same time as male colleagues collected up to 650,000 pounds.
"These cases are a wake-up call to the sector, both in Britain and in the US, because they mean they (the banks involved) are losing their reputation, which also means they lose in the war for talent," said Julie Mellor, who chairs Britain's Equal Opportunities Commission.
Banks have made efforts to sort out the problem.
Citigroup, the world's largest financial services group, has set up Women's Councils in the United States and Europe to increase retention and promotion of women. Last year the bank put nearly half of its management committee through diversity training and promised all would complete it this year.
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