Interventions

Pay transparency, the new frontier of corporate governance: from regulatory obligation to strategic leverage for companies

by Simone Giuliano

21 April 2026

3' min read

Translated by AI

Versione italiana

3' min read

Translated by AI

Versione italiana

With the new EU directive on pay transparency, to be implemented in Italia by 7 June 2026, member states will have to introduce a framework of rules to strengthen the principle of equal pay and reduce the gender pay gap. But the coming change goes far beyond the publication of salary data or the introduction of new reporting obligations. It is a transformation that will profoundly affect the way companies define their remuneration policies, negotiate with employees and build their organisational culture.

In fact, the new rules introduce a number of instruments designed to make the wage system more transparent and verifiable. These include periodic and structured checks on salaries, the obligation to provide objective justifications for any differences in pay, and greater transparency already at the personnel selection stage. Companies will have to indicate the starting salary or a reference salary range in job offers, while employees will have the right to know the salary ranges applied to equivalent positions within the organisation.

Another central element concerns the collection and publication of aggregated data on the gender pay gap. The aim is to make it easier to detect inequalities and to take corrective action. In this sense, pay transparency is not limited to a formal fulfilment, but aims to strengthen trust, fairness and sustainability within the employment relationship.

For companies, however, the impact of the directive will not be dealt with as a mere procedural change. In many cases it will be a real organisational transformation. Companies will have to review incentive systems and historical practices that have become entrenched over time without a real link to objective criteria or actual performance. It will be necessary to eliminate subjective elements in the determination of remuneration, to define clearer salary structures and to be prepared to answer increasingly pointed questions from employees, internal representatives and supervisory authorities.

In concrete terms, this means rethinking remuneration policies and defining more transparent and easily justifiable salary ranges. At the same time, it will become crucial to strengthen collaboration between the different corporate functions involved: human resources, compensation, finance and industrial relations. The main challenge will be not so much technical as cultural. In many contexts, in fact, the issue of remuneration has historically been handled with a certain confidentiality; instead, the new legislation introduces a different paradigm, based on criteria of clarity, comparability and accountability.

From the workers' point of view, the change will also be significant. The new rules will strengthen the right to understand how one's salary is determined and allow one to compare one's position with that of colleagues performing equivalent tasks. This will increase the perception of fairness within organisations, but will also lead to increased expectations of companies.

It will therefore be essential for HR teams and managers not only to ensure compliance with the new rules, but also to develop the ability to explain and motivate pay choices. Transparency will require new skills: data analysis, communication skills and appropriate tools to continuously monitor pay equity.

Not surprisingly, many organisations are already starting to prepare themselves. The most advanced companies are reviewing their job frameworks, calculating objective salary averages per job category and updating position classification systems. In some cases they are also eliminating individual bonuses that are difficult to justify or negotiating more transparent and shared compensation models with employee representatives.

Another key step concerns the management and organisation of pay data. Having accurate and easily accessible information will indeed become essential to demonstrate the consistency of remuneration policies and to face possible audits by the authorities. Precisely for this reason, many companies are investing in technological tools and platforms that make it possible to automate checks, monitor pay indicators and prepare the necessary documentation in the event of audits or inspections.

An often underestimated element concerns the preparation of management. Remuneration transparency, in fact, does not end with the definition of policies or the publication of data, but requires that managers are put in a position to manage the dialogue with people effectively. Questions such as "Why does this colleague earn more than me?", "What do I have to do to advance in level?" or "What are the evaluation criteria?" will become more and more frequent and require clear, consistent and policy-aligned answers.

This implies a targeted investment in training and tools so that managers can approach these conversations with awareness, avoiding ambiguities or misalignments that risk compromising people engagement and talent retention.

Looking ahead, pay transparency is therefore much more than a new regulatory obligation. Organisations that tackle this change proactively will be better prepared to communicate their decisions, defend the consistency of pay policies and build a pay culture based on fairness and accountability.

Simone Giuliano, Senior Director Business Development Southern Europe & Africa ADP