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Article
Publication date: 1 March 2021

Hsiu-I Ting

This study aims to investigate the relations between CEO gender, power and bank performance. First, this study examines the relation between CEO gender and power. Do female

Abstract

Purpose

This study aims to investigate the relations between CEO gender, power and bank performance. First, this study examines the relation between CEO gender and power. Do female CEOs possess less power than male CEOs? As women reach the top, do they hold similar or even higher levels of power as men? Second, this study investigates the relation between the CEO gender and bank performance. How do female CEOs perform? Is the relation between gender and performance subject to CEO power?

Design/methodology/approach

This study uses the following three performance measures: ROA, pre-tax ROA and pre-provision profit over assets. This study follows Finkelstein’s (1992) classifications and adopt five variables to measure the four dimensions of CEO power: duality and compensation share measure structural power; ownership captures ownership power; number of functional areas measures the power of expertise; and elite education captures prestige power. Logit model, ordinary least squares regression and quantile regression methods are used in the analysis.

Findings

In a sample of Chinese banks, female CEOs are found to have similar power and performance as male CEOs. As women reach the top, they hold higher ownership and greater prestige power than men. Female CEOs even outperform male CEOs in non-state dominated banks. Female CEOs show their impact through their power: those with higher compensation shares or greater power are positively related to bank performance.

Originality/value

Overall, the results show that as women reach the top, they hold a higher level of power than men. As females break through the glass ceiling, they perform better than males. Moreover, female CEOs show their impact through their power. Female CEOs who overcome the barriers are less traditional and more self-directed than their peers.

Details

Journal of Enterprising Communities: People and Places in the Global Economy, vol. 15 no. 1
Type: Research Article
ISSN: 1750-6204

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Article
Publication date: 4 March 2021

Ronny Prabowo and Doddy Setiawan

We investigate the effect of female CEOs on corporate innovation using Indonesian companies. More specifically, this paper aims to answer the following research questions…

Abstract

Purpose

We investigate the effect of female CEOs on corporate innovation using Indonesian companies. More specifically, this paper aims to answer the following research questions. First, do firms led by female CEOs innovate more or less than firms led by male CEOs? Second, does firm size positively moderate the effect of CEO gender on corporate innovation? Our research questions imply that female CEOs' innovative performance likely depends on the size of their firms.

Design/methodology/approach

Because the dependent variable is a dummy that equals one if the firm was an innovator and zero otherwise, this study employs probit analysis to test the hypotheses empirically. As an alternative test, we use a different measure of the dependent variable (INNOV-corporate innovation) by summing the firm's responses (yes/no) to nine innovation-related questions. Because this alternative measure of INNOV exhibits a count-data characteristic with non-negative integer values and more than 70% of the total sample did not engage in innovation activities at all, this study relies on the zero-inflated Poisson regression in the robustness test.

Findings

We have shown that firms led by female CEOs exhibit a greater probability of being innovators. Further, firm size increases the positive effect of female CEOs on firms' probability of engaging in innovation activities. Further, we also find that when female CEOs manage women-owned firms, their firms are more likely to engage in innovation activities.

Research limitations/implications

This study cannot further investigate the causal relationship between CEO gender and corporate innovation (e.g. by analyzing whether CEOs with different gender affects firm innovation) because it relies on the World Bank Enterprise Survey data. Nevertheless, this study suggests that stakeholders, especially in developing countries like Indonesia, need to encourage more women to hold CEO positions, especially in larger firms, because women-led firms perform better in innovation activities.

Originality/value

Our study thus highlights that female CEOs outperform their male counterparts in innovation activities. These results support the argument that because of gender-based discrimination that they receive, female CEOs are greatly motivated to exhibit greater innovation performance. Further, it is more difficult for women to hold the CEO positions in larger firms because of these firms' more intense managerial job market.

Details

International Journal of Social Economics, vol. 48 no. 5
Type: Research Article
ISSN: 0306-8293

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Article
Publication date: 5 October 2015

Thoranna Jonsdottir, Val Singh, Siri Terjesen and Susan Vinnicombe

The purpose of this paper is to examine how directors’ roles and social identities are shaped by gender and board life stage, using pre- and post-crisis Iceland as the…

Abstract

Purpose

The purpose of this paper is to examine how directors’ roles and social identities are shaped by gender and board life stage, using pre- and post-crisis Iceland as the setting. Recent theoretical work suggests the importance of directors’ monitoring and resource provision roles at certain board life stages; however, there is limited empirical evidence of directors’ identification with these roles as well as social role identification as a member of the board.

Design/methodology/approach

The authors contribute empirical evidence from interviews with 23 corporate directors in Iceland on individual identification with the director role of monitoring and resource provision, relational identification with the CEO role and social identification as a member of the board.

Findings

Prior to the crisis, male directors identified more strongly with resource provision and with their social roles and less strongly with monitoring roles. Compared to their male counterparts, pre-crisis female directors identified more strongly with monitoring and did not identify with their social roles. After the crisis, mature boards’ male director role identities were little changed; male directors continued to identify with resource provision and social identification, rather than monitoring, roles. Compared to pre-crisis, post-crisis female directors described greater identity with their resource provision roles and reported that male directors resented their attempts to fulfill their monitoring roles. In post-crisis, newly formed diverse boards, male and female directors reported very similar role identities which reflected balanced monitoring and resource provision roles, for example providing the board with ethical individual identities and unblemished reputations. The findings of this paper indicate that board composition and life cycle stage might have more impact on director identity than a pre- or post-crisis setting. These findings suggest implications for theory, practice and future research.

Originality/value

This paper provides further empirical evidence of the roles male and female directors identify with on corporate boards. Its originality lies in the context of the board work in terms of newly formed and mature boards, before and after the financial crisis, with differing gender composition (male-dominated and gender-balanced boards).

Details

Gender in Management: An International Journal, vol. 30 no. 7
Type: Research Article
ISSN: 1754-2413

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Article
Publication date: 15 May 2007

Susan M. Adams, Atul Gupta, Dominique M. Haughton and John D. Leeth

To provide insights into the experience of women aspiring to the CEO position, particularly regarding qualifications and compensation expectations.

Abstract

Purpose

To provide insights into the experience of women aspiring to the CEO position, particularly regarding qualifications and compensation expectations.

Design/methodology/approach

The ExecuComp database of executives at 1,500 large US corporations from 1992 to 2004 was used to identify women CEOs and to examine gender differences in compensation of executives over that period. Additional information about the backgrounds of female CEOs was collected from company press releases and regulatory filings.

Findings

Women are not as highly compensated as men before becoming CEO but the few who reach the CEO position receive similar compensation as men. While women CEOs are younger on average than men, they have impressive work experience and education.

Research limitations/implications

The study covers relatively large US companies that are publicly traded; thus, smaller firms and privately‐held firms are not included.

Practical implications

Impressive work experience, usually from within the company, and a strong education seem to be associated with promotion to the CEO position. Female executives should be more aware of the existence of gender differences in compensation at positions other than the CEO.

Originality/value

Much is written about the gender‐based duality of the leadership career and the overall gender gap in compensation. This study adds an in‐depth analysis of compensation at the top of the executive ladder to better understand who makes it to the top and whether they are equitably rewarded.

Details

Women in Management Review, vol. 22 no. 3
Type: Research Article
ISSN: 0964-9425

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Article
Publication date: 5 October 2015

Maretno Agus Harjoto, Indrarini Laksmana and Robert Lee

– The purpose of this study is to examine the impact of gender and ethnicity of CEO and audit committee members (directors) on audit fees and audit delay in the US firms.

Abstract

Purpose

The purpose of this study is to examine the impact of gender and ethnicity of CEO and audit committee members (directors) on audit fees and audit delay in the US firms.

Design/methodology/approach

Audit-related corporate governance literature has extensively examined the determinants of audit fees and audit delay by focusing on board characteristics, specifically board independence, diligence and expertise. The authors provide empirical evidence that gender and ethnicity diversity in corporate leadership and boardrooms influence a firm’s audit fees and audit delay.

Findings

This study finds that firms with female and ethnic minority CEOs pay significantly higher audit fees than those with male Caucasian CEOs. The authors also find that firms with a higher percentage of ethnic minority directors on their audit committee pay significantly higher audit fees. Further, the authors find that firms with female CEOs have shorter audit delay than firms with male CEOs and firms with a higher percentage of female and ethnic minority directors on their audit committee are associated with shorter audit delay. Results indicate that female CEOs and both female and ethnic minority directors are sensitive to the market pressure to avoid audit delay.

Research limitations/implications

The results suggest that gender and ethnic diversity could improve audit quality and the firms’ overall financial reporting quality.

Practical implications

This study provides insights to regulators and policy-makers interested in increasing diversity within a firm’s board and top executives. Recently, the US Securities and Exchange Commission (SEC) and the European Commission have been pressing publicly traded companies to improve diversity among their directors. This study provides evidence and perspective on how diversity can enhance financial reporting quality measured by audit fees and audit delay.

Originality/value

Previous studies have not given much attention on the impact of racial ethnicity in addition to gender characteristics of top executives and audit committee directors on audit fees and audit delay.

Details

Managerial Auditing Journal, vol. 30 no. 8/9
Type: Research Article
ISSN: 0268-6902

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Article
Publication date: 13 February 2009

Patricia V. Roehling, Mark V. Roehling, Jeffrey D. Vandlen, Justin Blazek and William C. Guy

The purpose of this paper is to investigate whether overweight and obese individuals are underrepresented among top female and male US executives and whether there is…

Abstract

Purpose

The purpose of this paper is to investigate whether overweight and obese individuals are underrepresented among top female and male US executives and whether there is evidence of greater discrimination against overweight and obese female executives than male executives.

Design/methodology/approach

Estimates of the frequencies of overweight and obese male Fortune 100 CEOs and female Fortune 1000 CEOs were obtained using publicly available photographs and raters with demonstrated expertise in evaluating body weight. These “experts” then estimated whether the pictured CEOs were normal weight, overweight or obese.

Findings

Based upon our expert raters’ judgments, it is estimated that between 5 and 22 per cent of US top female CEOs are overweight and approximately 5 per cent are obese. Compared to the general US population, overweight and obese women are significantly underrepresented in among top female CEOs. Among top male CEOs, it is estimated that between 45 and 61 per cent are overweight and approximately 5 per cent are obese. Compared to the general population overweight men are overrepresented among top CEOs, whereas obese men are underrepresented. This demonstrates that weight discrimination occurs at the highest levels of career advancement and that the threshold for weight discrimination is lower for women than for men.

Practical implications

Weight discrimination appears to add to the glass ceiling effect for women, and may serve as a glass ceiling for obese men.

Originality/value

This paper uses field data, as opposed to laboratory data, to demonstrate that discrimination against the overweight and obese extends to the highest levels of employment.

Details

Equal Opportunities International, vol. 28 no. 2
Type: Research Article
ISSN: 0261-0159

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Article
Publication date: 11 April 2021

Suherman Suherman, Berto Usman, Titis Fatarina Mahfirah and Renhard Vesta

This paper aims to investigate the relationship between female executives, chief executive officer (CEO) tenure and corporate cash holdings in the context of the…

Abstract

Purpose

This paper aims to investigate the relationship between female executives, chief executive officer (CEO) tenure and corporate cash holdings in the context of the developing Southeast Asian capital market (Indonesia).

Design/methodology/approach

The sample was screened from 231 publicly listed companies in the Indonesian Stock Exchange. The period of observation was 2011–2017. Two measures were applied for corporate cash holdings: the ratio of cash and cash equivalent to total assets and cash and cash equivalent to net assets. Three surrogate indicators were used for female executives: female CEO, the proportion of female members in the board of management and the number of female members in the board of management. CEO tenure is the length of time a CEO has been a member of the board of management. This study uses panel data regression analysis, including the fixed effect model with clustered standard errors.

Findings

The empirical evidence indicates that female executives and CEO tenure are positively and negatively associated with corporate cash holdings, respectively, and both are significantly related. Additional analysis using lagged independent variables remains consistent with the main analysis, suggesting that corporate cash holding becomes higher as a female presence in the board of management increases.

Research limitations/implications

Empirical tests set in Indonesia suggest that female executives are more conservative and risk-averse, thereby holding more cash with a precautionary motive. The findings also imply that CEOs with long tenure focus on long-term performance such as increasing research and development investments or capital expenditure, thus holding less cash. Accordingly, policymakers and regulators should promote diversity issues proportionally and advance to the board level.

Originality/value

This study contributes to the field of executive and CEO studies by enriching the empirical findings in related topics. In addition, to the best of the authors’ knowledge, this is one of the first studies applying two measures of cash holdings in the setting of a developing Southeast Asian capital market (Indonesia).

Details

Corporate Governance: The International Journal of Business in Society, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 28 September 2020

Nazli Sila Alan, Katsiaryna Salavei Bardos and Natalya Y. Shelkova

The motivation behind Section 953(b) of Dodd–Frank Act was the increasing pay inequality and supposed CEOs' rent extraction. It required public companies to disclose CEO

Abstract

Purpose

The motivation behind Section 953(b) of Dodd–Frank Act was the increasing pay inequality and supposed CEOs' rent extraction. It required public companies to disclose CEO-to-employee pay ratios. Using the ratios reported by S&P 1500 firms in 2017–18, this paper examines whether companies led by women and minority CEOs have lower ratios than those led by white male CEOs.

Design/methodology/approach

This paper uses multivariate regression along with a matched sample analysis to examine whether female and minority CEOs have higher CEO-to-employee pay ratios compared to male and white CEOs, controlling for other determinants of pay ratios.

Findings

Results indicate that CEO-to-employee pay ratios are 22–28% higher for female CEOs compared to their male counterparts, controlling for other determinants of pay ratios. There is, however, no statistically significant difference between the pay ratios of minority vs white male CEOs. Minority female CEOs have lower CEO-to-employee pay ratios than white female CEOs. Consistent with literature, larger and more profitable firms have higher CEO-to-employee pay ratios.

Originality/value

While prior studies on determinants of CEO-to-employee pay ratios have used either industry-level or self-reported data for a small subset of firms (resulting in selection bias), this paper uses firm-level data that are available for all S&P 1500 firms due to new disclosure requirements due to the Dodd–Frank Act Section 953(b). Moreover, this is the first paper to test whether gender or ethnicity of a CEO affects within-firm pay inequality.

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Article
Publication date: 10 June 2020

Kylie A. Braegelmann and Nacasius U. Ujah

This paper aims to revisit the extant evidence on gender bias in the market. Specifically, it revisits reaction to CEO announcements. Also, it explores whether the…

Abstract

Purpose

This paper aims to revisit the extant evidence on gender bias in the market. Specifically, it revisits reaction to CEO announcements. Also, it explores whether the development of the bias over time and by firm size aligns with existing theory.

Design/methodology/approach

The paper examines cumulative abnormal returns around CEO announcements from 1992 through 2016 using a modified event study methodology. This evidence shown examines market reactions over time and by firm size.

Findings

Financial markets react more favorably to male CEO announcements, with a cumulative abnormal return of 49 basis points above the reaction to their female counterparts. Moreover, the paper finds that market reaction varies over time, which may be because of the increasing proportion of female CEOs, and by firm size, which may be due to the differences in new information available to investors.

Research limitations/implications

Limitations include sample size due to the paucity of female CEO announcements. This paper does not examine the effect of industry, detailed CEO characteristics or announcement content on market reaction. In addition, using an extended event window may increase the likelihood of capturing confounding events, such as mergers or earnings announcements, which limits the interpretability of the results.

Practical implications

Gender bias in financial markets creates another institutional barrier for the advancement of female professionals, as well as implies inefficient capital allocation in markets.

Originality/value

The literature in this field is still inconclusive. Furthermore, bias development over time and the effect of information on bias remain unexplored. This study aims to fill that gap; furthermore, it introduces an extended event-window approach.

Details

Managerial Finance, vol. 46 no. 10
Type: Research Article
ISSN: 0307-4358

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Article
Publication date: 4 October 2011

Eahab Elsaid and Nancy D. Ursel

The purpose of this paper is to examine, within a succession framework, the impact of the gender composition of boards of directors on the gender of the CEOs they appoint…

Abstract

Purpose

The purpose of this paper is to examine, within a succession framework, the impact of the gender composition of boards of directors on the gender of the CEOs they appoint, and to assess the impact of newly appointed CEOs' gender on risk taking by the firm.

Design/methodology/approach

The authors estimate a two‐stage least squares regression using data on 679 CEO successions in North American firms.

Findings

The results show that successor CEOs are more likely to be female the greater the percentage of females on the board, regardless of other succession characteristics such as whether the new CEO is from inside or outside the firm. Furthermore, a change in CEO from male to female is associated with a decrease in several measures of firm risk taking.

Research limitations/implications

The sample is restricted to relatively large, exchange‐traded North American firms and may not generalize to other groups.

Practical implications

The findings suggest that women aspiring to CEO positions and firms wishing to promote women should monitor board composition to ensure female representation. Other steps that the firm may take to promote women to this position (such as looking outside the firm) have an insignificant impact when board composition is taken into account.

Originality/value

The findings are novel and inform CEO succession research by demonstrating which succession process characteristics work to increase females' chances and which have no effect. Female CEOs are likely to provide leadership that reduces the risk profile of the firm.

Details

Gender in Management: An International Journal, vol. 26 no. 7
Type: Research Article
ISSN: 1754-2413

Keywords

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