New Metrics

GoodWell ‘Mind the Gap’ Initiative to Create Common Methodology to Measure Pay Inequality

Without a uniform, universally accepted and publicly available measurement methodology, companies large and small wanting to eradicate the pay gap are often left wondering where to start.

By Sustainable Brands | Published 6 years ago | About a 2 minute read

Without a uniform, universally accepted and publicly available measurement methodology, companies large and small wanting to eradicate the pay gap are often left wondering where to start.

A new initiative by GoodWell, a workplace certification company, dubbed Mind the Gap, aims to aggregate the many ways companies are measuring gender and racial inequality in order to deliver consistent and transparent standards to this pervasive problem for the first time.

“The fundamental problem is that none of these companies that say they want to measure and correct a documented pay gap actually disclose how they measured their own pay gaps,” said Pete Gombert, Founder and President of GoodWell.

Currently, organizations might participate in the White House Equal Pay Pledge or Glassdoor Equal Pay Pledge, or even join in Bloomberg’s new Gender Equality Index, but the details are lacking as to how each certificate measures the pay gap.

“We don’t know if we are comparing apples to apples,” explained Gombert. “What we need — and what we aim to build through Mind the Gap — is the equivalent of GAAP, which are generally accepted accounting principles for measurement of pay equity.”

Currently, GoodWell and Glassdoor are the only organizations to make their methodologies publicly available, which allows corporate, government and nonprofit leaders to assess their pay gaps free of charge. The problem, Gombert says, is that many organizations use proprietary measurement tools that are not universally accepted.

“Companies such as Salesforce, Adobe and Citigroup have done the hard work of developing methodologies,” Gombert said. “But because they have not shared them with the world, employees, peer companies and the general public are left to guess how pay disparity was calculated.”

Mind the Gap will collect and confidentially analyze all of the methodologies. The initiative will highlight their similarities and differences and gather experts to produce a final methodology in the third quarter this year that will be made available to everyone, free of charge.

“To correct the gap, we first need to accurately measure it and include not just men and women but also factor in data around race, age, religion and sexual orientation,” Gombert added.

The Equal Pay Act of 1963 made it illegal to pay individuals differently based on gender. However, because such cases are nearly impossible to prove, the burden still lies with the employer to ensure equity in compensation.