Rachel Reeves, chair of the Business, Energy and Industrial Strategy (BEIS) Committee said she is encouraged by Yorkshire Water’s openness as the water company published its ethnic pay gap statistics.

Yorkshire Water has revealed that its mean ethnic pay gap is 3 per cent and has encouraged other companies to follow suit in publishing the data.

The figure appears in Yorkshire’s first “workforce diversity” report and forms part of the firm’s commitment to being “one of the most transparent” companies.

Last year, Yorkshire Water said it plans to release the “majority” of its operational and service data by 2020, creating a form of “citizen regulation”.

The new report also includes the pay gap for its customer service business Loop, which is 6.6 per cent. The combined mean ethnic pay gap for the two businesses is 17.9 per cent and the median is 27.6 per cent due to the size populations in each organisation and the difference in salaries.

As well as the pay gap figures, the report shows how the workforce breaks down at all levels by gender and ethnicity. The company has also published a “limited amount” of data relating to disability in the workforce.

Yorkshire Water said it recognises that while its data on gender is “comprehensive”, information on ethnicity and disability is “less complete”.

It said this is because overall 14 per cent of colleagues have chosen not to disclose the information.

The company hopes to improve the completeness of its data and will be launching a plan to raise awareness of the importance of “self-declaration”.

In the meantime, it will also make use of data analytics tools to provide some of the missing ethnic profile data.

Yorkshire Water admits that the data it does have “shows many areas” where the company needs to make “significant improvements” if it is to achieve a “truly diverse and inclusive workforce”.

The report mostly shows data tables without a narrative or explanation as Yorkshire said it wants the “data to speak for itself” and then enter dialogue with employees, communities and stakeholders.

Richard Flint, chief executive of Yorkshire Water, said: “We made a commitment to take a leading position on openness and transparency and this report is an important part of that commitment.

“We intend to have an open dialogue with other large employers, such as local authorities, so that we can align our efforts to improve the diversity of our workforce with theirs and ensure we are working collaboratively.

“However, we know we must not rest on our laurels. We currently have no data on any of the other protected grounds such as religion and belief, sexual orientation, gender reassignment, marriage and civil partnership or pregnancy and maternity.”

He added: “Our priority is to substantially improve our data so that next year’s report shows an even more comprehensive picture. At the very least we would expect to show comprehensive disability data and also calculate our disability pay gap once the level of available data makes that a meaningful statistic. We will progressively extend that coverage, in line with improved self-declaration until we cover all the protected grounds.”

Reeves said: “I’m encouraged by Yorkshire Water’s decision to be open and publish their ethnic pay gap statistics. This approach will lead to honest conversations and I am sure, positive changes. I am hoping other companies not just in Yorkshire but around the country follow suit.”

Yorkshire Water said it aims to release its disability pay gap in “the future”.

Last month, the bosses of 30 of the UK’s biggest energy and water companies pledged to increase the diversity of their workforces to better reflect the communities they serve.

The signatories included Yorkshire Water, Centrica, Northern Power Grid and UK Power Networks.