Insights

From a pure economic perspective, wages are the result of two functions: the supply of work and the demand for work. At the point of equilibrium, the occupancy rate and the level of wages are determined. Nevertheless, as it often occurs, market dynamics result in mispricing, externalities and market failures. All of which are met with unease by market participants, including legislators.

That is precisely what happened with the mispricing of wages between genders, leading to gender pay gaps. These incongruences – which are still widespread worldwide – have been the target of many legislations in continental Europe, the United Kingdom and the United States of America. Nevertheless, among the different initiatives to reduce gender pay gaps and other types of discrimination, the EU Pay Transparency Directive – adopted by the European Council in April 2023 – is the one that sets the highest bar in terms of demands for companies. Indeed, firms are getting ready to comply with a long list of requirements, aware that EU member states must implement the directive into national law no later than mid-2026. Some of the requirements will be disclosing salary ranges in job ads, refraining from asking candidates about their salary history, conducting joint pay assessments with workers‘ representatives and mandatory reporting when meeting specific firm size criteria. Interestingly, the list of obligations, which continues further, is characterised by an aura of uncertainty as European countries might transpose the directive into national law differently.

The survey – which aims at assessing the evolution of pay transparency reviews and initiatives in Swiss organisations – confirms the relevance of the EU Directive, with more than three-quarters of survey respondents highlighting a direct impact. The rest of the firms sampled have in common an almost exclusive Swiss-based workforce. Besides regulation, we note how the expectations of employees, candidates and other external stakeholders are rising and thus adding pressure.

To understand how pay transparency is evolving in Swiss companies, we structured our analysis along three dimensions – Perceptions, Practices and Priorities. These three lenses allow us to see not only what companies think, but also what they do today and where they intend to go next.

We start with Perceptions – because transparency is, above all, a mindset shift – exploring the importance of the topic, the factors driving pay transparency and its multidimensional nature. This includes insights around opportunities and concerns linked to implementing organisational changes highlighted by survey participants.

Next, the Practices section measures where companies stand in terms of actions taken, including pay reviews and communication approaches. This is where perception meets reality: how transparently are companies sharing pay information and how far have they moved from intention to implementation over the past two years?

Finally, we turn to Priorities – the roadmap on remuneration. We asked organisations where they currently stand on the transparency of pay elements – base salaries and variable compensation – and what changes they expect about the transparency of different pay elements. Moreover, we get a view on where they plan to invest next: in grading systems, in communication, in pay governance or in leadership training.

Taken together, these three perspectives – perceptions, practices and priorities – provide a clear picture of the current state of pay transparency in Switzerland, how it has shifted since 2023 – when the survey was last conducted – and what is likely to come next.