The Pension Gap Isn’t a “Women’s Issue”. It’s Your Reward Strategy Failing

The real problem isn’t that employers don’t care about financial security. It’s that they keep treating it as a perk, not as a system. And systems, left alone, reproduce the same outcomes: unequal pay, unequal time, unequal retirement.

There’s a small moment early in our conversation with Josephina Smith on the Friends with Benefits podcast where the temperature changes.

It’s not when the hosts mention National Insurance and pension costs. It’s when Josephina, Director of Reward and Recognition at British Airways, says something plain enough to be missed.

“This is a societal issue,” she says, talking about the pensions gap. “It’s not just an employer’s issue.”

Then she adds the line that should make any senior HR leader sit up: “Men are almost double in terms of their pension pot.”

The pensions gap is not a mystery. It’s arithmetic and time. Men, on average, earn more; women, on average, pause more — for care, for part-time work, for the invisible labour that still props up modern economies. Compound those differences over decades, and you get a retirement system that doesn’t just reflect inequality but fossilises it.

Yet most organisations still treat this as something like the weather: regrettable, external, unfortunate. You can acknowledge it. You can run a webinar. You can add a financial wellbeing tile on an intranet. You can put a comforting sentence in a benefits brochure. But you don’t change the system. And if you don’t change the system, the outcome is the outcome.

That’s the real significance of what British Airways did — and of Josephina’s insistence on changing one word: moving from financial wellbeing to financial empowerment. This isn’t semantics. It’s a shift in how the employer understands its role.

Because wellbeing is often a label you paste over a problem you don’t plan to solve. Empowerment, if you mean it, is a design challenge.

The Problem

Most enterprise benefits strategies now include something that looks like financial wellbeing. But too often it functions like corporate aromatherapy: soothing, broadly popular, and structurally irrelevant.

Josephina’s argument is that employers can’t keep confusing availability with access, or tools with power. “It’s more the how than the what,” she says. “I can give you as many tools as you want… If they don’t have a mindset of saving money… then they’re not gonna do it.”

That’s easy to dismiss as personal responsibility — until you hear the second half of her point. Employers also have to build systems that meet people where they are. Financial empowerment isn’t just a portal full of calculators. It’s segmentation, relevance, distribution, and social proof. It’s making the content feel like it belongs to the workforce you actually have, not the workforce you wish you had.

Her example is instructive. BA’s programme worked, she argues, because it didn’t stay theoretical. It had strong partners. It was intentionally designed. And crucially, it was adapted country by country rather than copied wholesale from a UK template.

“Sometimes we just want to package what we’ve done in the UK and just implement that package in a different [country],” she says. “And then it doesn’t work… and then we abandon it. Then that’s a waste of money.”

That pattern shows up repeatedly in global benefits rollouts. The waste doesn’t usually come from choosing the wrong vendor. It comes from organisational impatience: launching something that looks progressive, failing to drive uptake, then concluding the workforce doesn’t care — when the reality is that the system never fitted the lived experience of the people inside it.

The pensions gap sits right in the middle of this. It’s the ultimate test of whether a benefits strategy is real. If you can’t move retirement outcomes, you’re not doing financial wellbeing. You’re doing financial messaging.

Why It Happens

The pensions gap persists partly because the employer’s mental model is wrong.

In many organisations, reward still occupies an awkward conceptual basement: simultaneously framed as a huge cost and as something that isn’t truly strategic.

Josephina challenges this directly by returning to first principles: people create profit for the business. Value creation is human. People performance is business performance.

And yet, as Carl Chapman, Ben’s VP of Benefits Strategy and Partnerships, notes during the conversation, many leaders still separate the two — talking about performance as if it exists independently of the workforce that produces it.

That disconnection creates predictable outcomes. Reward becomes spend to be contained rather than investment to be designed. Benefits become a collection of promises and compliance obligations. Pensions are technically present but rarely worked as a lever of fairness.

Then there’s the cultural alibi: values.

Josephina is openly sceptical of the way organisations talk about rewarding against values. “It really makes me really cringe,” she says, when companies claim this without evidence. In practice, organisations tend to reward whatever delivers short-term results, and then retrofit the story.

“I want to see those values in your behavior,” she says. Are they actually visible in how people are rewarded?

This matters for the pensions gap because values-aligned reward often becomes a rhetorical shield. A company can talk fluently about inclusion and belonging while running a reward system that reproduces gendered outcomes year after year. The values are on the wall; the incentives sit quietly in the spreadsheet.

That’s why the gap doesn’t shift. Not because HR leaders don’t care, but because the system is designed to keep moving even when nobody is consciously steering it.

Pay structures, progression norms, parental leave patterns, part-time penalties, pension defaults — these are all forms of institutional inertia. Left unchallenged, they deliver the same destination.

As Carl notes, for many reward professionals it can feel like pushing a rock uphill. Josephina doesn’t deny the effort involved — but she rejects the idea that difficulty is a justification for waiting. Her view is that organisations don’t need to wait for an external catalyst to act.

COVID proved that point uncomfortably well.

A Different Way of Thinking

Josephina keeps coming back to one word: empowerment.

When she talks about financial empowerment, she describes a mix of access, segmentation, mindset, and relevance. What’s striking is how far this pushes beyond the traditional boundaries of benefits administration. This isn’t about selecting a provider and sending a comms email. It’s about behaviour, belief, and barriers.

For senior HR leaders, that reframes financial education as a workforce capability — something to be built deliberately, like safety or leadership, and measured accordingly.

At BA, that started with clarity about what the programme was actually trying to achieve. From there came simplicity, local relevance, and credibility. Rather than relying on abstract guidance, the programme brought in lived experience — including speakers who had moved from financial hardship to stability and spoke candidly about discipline and confronting reality.

“The sooner you face it, the better it is,” she says, describing the message that landed most powerfully.

This approach matters because many employees distrust corporate financial messaging. Too often it sounds like encouragement to cope better with structural pressure: stagnant wages, rising costs, unpredictable schedules. Credible third voices and a framing built around agency rather than obligation can shift that psychological contract.

But empowerment has to go further — particularly when it comes to pensions.

Josephina is clear about the structural drivers: pay gaps, caring breaks, and part-time work. She rejects the idea that women simply choose to save less. “It’s having something to contribute in the first place,” she says. When money is tight, pensions will always lose to groceries.

That’s why she raises more provocative possibilities — including whether partners could contribute into pensions during maternity leave or career breaks. It’s not a neat policy solution so much as a challenge to conventional boundaries. If we accept the structural causes of the gap, then meaningful intervention won’t stay neatly inside existing benefit categories.

If you want to change outcomes, you have to touch the levers that create them.

Complication & Reality

None of this happens in a vacuum. The conversation opens with the possibility of rising employer costs and long-term uncertainty. Josephina is pragmatic about what that means. Employers don’t like additional cost, and even if changes are years away, she notes that businesses already plan far ahead.

That context matters. Cost pressure is where many benefits ambitions stall, not because the ideas are wrong, but because they are inconvenient.

When Carl asks what gets cut first if budgets tighten, Josephina’s answer is operational rather than ideological: revisit modelling, challenge assumptions that didn’t materialise, and find leverage. Strategy, in reward, often looks like disciplined decision-making rather than grand gestures.

But she also points to a harder constraint: courage.

Change, in her view, starts with mindset. Technical expertise helps you spot opportunities, but acting on them requires confidence and resilience. Many don’t — deterred by misunderstanding, fear of failure, or the emotional charge that always surrounds pay.

Over time, reward teams can become experts in constraint. Tax, regulation, precedent, unions, comparators — caveats accumulate. Eventually, “can’t” becomes reflexive.

Josephina deliberately works against that. She invests in mindset sessions with her team, encouraging them to think and behave with confidence. She uses the familiar lion analogy — not to make a zoological point, but to give psychological permission to take space and lead.

She sets a clear expectation: the reward function exists to be impactful.

That matters because the consequences of getting reward wrong are not abstract. Particularly in unionised environments, failures quickly become operational risk. Industrial action isn’t a communications issue; it’s a business interruption.

Reward, in other words, isn’t just a cost. It’s a risk surface.

Broader Implications

The pensions gap tells you a great deal about an organisation. Whether it treats reward as a system or as a collection of benefits. Whether it measures outcomes or activity. Whether it designs for real employees or idealised ones. Whether its values are operational or ornamental.

It also reveals a deeper truth about modern employment. Employers are now major architects of financial life — not just through pay, but through pension defaults, matching, benefits access, and the behavioural cues embedded in policy. When Josephina talks about how reward finances people’s lives, she’s pointing to the institutional power organisations now hold.

That’s why the shift from wellbeing to empowerment matters. Wellbeing implies support. Empowerment implies agency — and accountability for the systems that enable it.

Employers have embraced the language of care while leaving the machinery of inequality largely untouched. Fixing that doesn’t require a single flagship programme, but a different posture: intentionality, segmentation, local relevance, and the courage to intervene.

If the pensions gap is societal, then no employer can solve it alone. But that can’t be the line you hide behind. In a world where work structures so much of adult life, “societal” often just means everyone’s problem — and therefore nobody’s redesign.

The organisations that lead in the next decade won’t be the ones with the longest benefits lists. They’ll be the ones that treat reward like an engine: measurable, governable, and designed to deliver fair outcomes, not just good intentions.

And if you’re still telling yourself you’ll wait for the catalyst, the last few years have already answered that question. Change was always possible. What mattered was whether anyone was prepared to act.

Watch the full episode below