Unpacking Pay Equity in Fashion: Italy

82% of surveyed CEOs believe that career advancement opportunities are equal between men and women, while only half of the surveyed DE&I and HR functions agree
Only 1 in 5 companies monitor gender pay gaps
43% of the manufacturing companies surveyed believe that motherhood negatively affects women’s career progression
Although micro-enterprises are currently exempt from pay equity regulations, about half say they have at least one policy in place to ensure gender pay equality

18 September 2024: Global Fashion Agenda (GFA) and PwC Italy have published a preliminary research report, Unpacking Pay Equity in Fashion: Italy, which explores the current perceptions and challenges regarding pay equity within one of Europe’s most influential fashion industries.

The publication, developed with support from Camera Nazionale della Moda Italiana (CNMI), provides a detailed assessment and a call to action – with practical guidance on how brands, manufacturers, and stakeholders can begin to address pay disparities and foster greater equality across the sector.

The analysis is based on research conducted through 25 interviews with leading fashion brands and a survey involving 105 Italian fashion manufacturing companies and manufacturers, research by GFA, and the findings of the multi-stakeholder project ‘Fashion Industry Target Consultation’, led by GFA and the United Nations Environment Programme (UNEP), and roundtable discussions.

Key Findings:

Women’s participation in the Italian labour market is generally low in all sectors: in 2023 the female employment rate was 52.5%, almost 20 points lower than the male employment rate (70.4%), with wide regional variations. The female employment rate in Italy is lower than that of Greece (52.8%), Romania (54.3%) and much lower than that of the Netherlands (78.9%) and Sweden (75.6%). The fashion manufacturing industry differs partially from the data observed at a national level, as it is characterised by an over-participation of women, especially in non-management roles.

Italy has witnessed an increase in the representation of women on the boards of major Italian fashion brands, from 21.3% in 2020 to 27% in 2023. This trend is mainly attributable to an increasing focus on gender inequalities that has led to more policies and laws supporting the presence of pink quotas in leadership positions.

When asked about their perception of the gender pay gap, only 20% of Italian fashion manufacturers reported pay inequality in their companies, most of which are large companies. However, only 1 in 5 companies monitor and report gender pay inequalities: monitoring and reporting inequalities are the first steps towards a more complete understanding and awareness of the phenomenon.

The survey shows that the perception of wage inequality varies depending on the role within the company: Human Resources (HR) and DE&I functions, which deal with these issues more frequently than others, tend to be more aware of wage discrimination. Two out of three HR and half of the DE&I function respondents clearly state that there are pay inequalities to the disadvantage of women, while only 20% of CEOs agree with this view. The perception of a gender gap in career advancement thus varies by function: while 82% of CEOs believe that opportunities in career progression is equal between men and women, half of DE&I and HR functions partially agree.

All large companies surveyed claim to have at least one instrument to ensure equal pay for women and men. However, more than 80% of the Italian fashion manufacturing industry is made up of micro enterprises, many of which are exempt from the current EU and Italian regulations on equal pay. Importantly, many of these small manufacturers are part of supply chains for large Italian and European brands that will have to comply with these regulations. Despite their size, 43% of micro enterprises claim to have at least one policy in place to ensure gender pay equity, followed by small enterprises (27%) and medium-sized enterprises (14%). Furthermore, half of the companies surveyed are considering applying for gender equality certification.

According to 43% of the respondents, motherhood negatively affects women’s career progression. A survey conducted by PwC Italy between April and May 2024 on a sample of 500 working or former working women between 25 and 49 years old with at least one child, showed that the main impact maternity had on work was reduced working hours and job loss.

Although 60% of the companies surveyed offer parenting support (the most common form of support is flexibility, 38% of companies), only 5% of companies provide additional paternity leave or crèches. These results indicate a lack of recognition for parenting needs, which is rooted in a gender bias regarding the division of family and domestic care responsibilities.

Recommendations for Action

This study by GFA and PwC Italy is call to action for the Italian fashion sector and brands working with the Italian supply chain to prioritise Pay Equity in Fashion and adopt more inclusive and responsible practices and embrace pay equity as a key component of its sustainability agenda. To address the pay equity challenges in the Italian fashion industry, the report outlines several key recommendations:

A Shift of Perspective: Foster an inclusive workplace culture that values parenthood and supports flexible working arrangements to accommodate family responsibilities.
Increased Transparency: Ensure full transparency and traceability across the supply chain, particularly among subcontractors, to guarantee fair wages and ethical labour practices.
Standardised Tools: Develop adaptable tools and methodologies for pay equity assessments that reflect the unique context of the Italian fashion manufacturing industry to foster heightened adoption and enhanced insight into suppliers’ wage structures.
Unified Approach: Encourage collaboration between brands, trade associations, and manufacturers to unify and streamline the process, ensure coherence in addressing this pivotal issue, and avoid overwhelming or duplicating efforts across the industry.