Companies around the world are increasingly acknowledging that pay transparency is critical to attracting and retaining talent, but many still don’t have a strategy in place to shed light on their compensation practices—and that’s despite looming regulation.
According to a survey of more than 1,100 companies across 45 countries, nearly seven out of ten employers admitted that pay transparency is now an expectation of job candidates. The survey also found evidence, however, of what researchers describe as a “readiness gap”: Only 32% of organizations indicated that they felt prepared to meet global transparency requirements.
Pay transparency legislation is ratcheting up across the globe.
States including New York, Colorado and California already have transparency laws in place. Others are due to follow. Nonetheless, only 19% of US companies have a pay transparency strategy, the research—conducted by global consultancy Mercer—found.
Laws are also due to come into effect across the European Union in 2026. Under that directive, companies that employ more than one hundred workers in the EU will be compelled to disclose information about pay levels to employees and candidates, and to report annually on their gender pay gap. Among the employers based in the bloc, however, only 7% have so far implemented a pay transparency strategy, the research found.
The researchers also found that, after job security, fair pay is the second most commonly cited reason why workers stay in a particular role. Nonetheless, as they note in the report accompanying the findings, “programs initially designed for internal HR purposes are falling short and not rapidly adapting to public facing transparency expectations.”
Relatedly, research published last year found that a huge number of employers around the world are also still reluctant to include salary data on job advertisements, even in markets in which posting pay is mandated by law. In the state of New York, for example, where almost all employers must disclose a salary range in job postings, 10% of advertisements omit pay information, that research found.
Mercer conducted its research in April and May of 2024. Just over a third of the companies that responded are headquartered in the Europe, with 32% based in the U.S, 22% in Canada, 7% in the U.K. and Ireland, and 4% in Asia.