This report highlights the urgent need for the finance and accountancy profession to lead the charge in addressing wage inequality, a critical factor in reducing global inequality, improving human rights and fostering sustainability.

Key Messages

Ethics and human rights are the main reasons why a living wage is important. Not paying a living wage should be regarded as an abuse of human rights, not dissimilar to modern slavery and child labour.

A business that cannot afford to pay a living wage does not have a sustainable business model. Business models with low margins that need to pay below a living wage in order to be viable need to be critically redesigned on the basis of value.

Helen Brand OBE, Chief Executive of ACCA, says: "The right of all employees and contractors to a living wage is an ethical responsibility, and finance professionals have a unique role and opportunity to drive it as a core part of their sustainability activities."

Living wage has the potential to act as a major socio-economic multiplier. It provides benefits across the eco-system – workers, employers, economy and governments.

While 86% of respondents feel their organisation should pay a living wage to its own employees, only 34% believe their organisation should be responsible for encouraging their Tier 1 suppliers to do so.

From a measurement and reporting perspective, finance and accountancy professionals should stay abreast of developments in sustainability reporting that focus on living wages and human capital. New approaches need to be explored by the profession for how it reports the value of people in corporate reporting.

Comment made by several roundtable participants: 'If a business is no longer viable simply from paying a living wage, then it does not have a sustainable business model’.

Value chains

Caroline Rees, president and co-founder, Shift, says: “A living wage is a fundamental human right. Organisations’ responsibility under international standards to respect human rights means paying workers in their own organisation adequately and using their purchasing practices and business relationships to advance living wages also for workers in their value chains. Change doesn’t happen overnight, but chief financial officers can and should drive demonstrable progress on this crucial issue.”

Finance leaders play a crucial role in driving living wage adoption by assessing and addressing wage gaps, integrating living wage practices into financial planning, and embedding them into sustainability strategies.

Richard Karmel, managing partner – London, Forvis Mazars, says: “The inability to pay a living wage throughout a value chain questions the sustainability of a business model. This is the time to critically appraise and make necessary changes with a focus on human capital.”

They must act now, driving ethical change across their organisations and supply chains, aligning with emerging reporting standards, and making wage equality a cornerstone of long-term business sustainability and resilience. The future of fair business practices starts with their leadership – they need to make the commitment today.

Calls to Action

The report offers several calls to action on various stakeholder groups and asks finance professionals to use their influence accordingly.