Gender role congruity theory emphasizes the ubiquity of male-typed leadership schemas as barriers to female leaders’ career development (i.e., descriptive stereotypes); however, the expectation of female leaders’ fulfilling their gender role (i.e., prescriptive stereotypes) has received limited attention. Extending this line of research, we propose the concept of female-typed leadership schemas and suggest that the (mis)match between female CEOs’ gender-stereotyped behavioral differences (agentic vs. communal) and female-typed leadership stereotypes helps explain the prescriptive gender stereotypes that women face in the CEO (...) post-succession stage. Using data from 251 female CEO succession events at publicly listed firms on the Shanghai and Shenzhen Stock Exchanges from 2007 to 2017 in China, we found that the risk-taking behaviors of new female CEOs may lead to a perceived mismatch between prescriptive gender-stereotyped expectations and the actual behaviors of female CEOs as top leaders, increasing their likelihood of being dismissed during the post-succession process. Moreover, gender inequality beliefs in local contexts and adverse selection at the time of succession amplify the gender-stereotyped attribution. This study contributes to the female leadership and ethics literature by developing a comprehensive theoretical framework to test how female-typed leadership stereotypes hinder the career development of women in top executive positions. (shrink)

The sex ratio at birth in China exhibits a major occurrence of “missing women” due to the high son preference in Chinese culture. Clearly, the large gender discrepancy in China can be explained not only by ethical, moral, or social fairness theories but also by the economic benefits of women's particular abilities, experiences, and talents. This article examines the influence of female chief financial officers on information disclosure violations in order to highlight women's positive contributions. Our data imply that having (...) a female CFO can dramatically lower the number of companies that fail to disclose information. The results are strong after controlling endogeneity with propensity score matching, Heckman's two-stage self-selection model, and CFO change, as well as controlling the gender of the chairman and chief executive officer, utilizing different study periods, and using exogenous shock. We further examined the moderate effects of CFO power and external monitoring, and we found that CFO power magnifies the negative effect of female CFO on violations; the more the power, the more the negative effect of female CFO on violations. We also found that when the firm has effective external monitoring, there are fewer future infractions of information disclosure. (shrink)

This study investigates whether audit partner gender is associated with the extent of auditor disclosure and the communication style regarding risks of material misstatements that are classified as key audit matters. Using a sample of UK firms during the 2013–2017 period, our results suggest that female audit partners are more likely than male audit partners to disclose more KAMs with more details after controlling for both client and audit firm attributes. Furthermore, female audit partners are found to use a less (...) optimistic tone and provide less readable audit reports, compared to their male counterparts, suggesting that behavioural variances between female and male audit partners may have significant implications on their writing style. Therefore, this study offers new insights on the role of audit partner gender in extended audit reporting. Our findings have important implications for audit firms, investors, policymakers and governments in relation to the development, implementation and enforcement of gender diversity. (shrink)

Adolescents have increasing discretionary income, expenditures, and purchasing power. Inventory shrinkage costs $123.4 billion globally to retail outlets. Adolescents are disproportionately responsible for theft and shoplifting. Both parents and peers significantly influence adolescents’ monetary values, materialism, and dishonesty as consumers. In this study, we develop a theoretical model involving teenagers’ social attachment and their consumer ethics, treat adolescents’ money attitude in the context of youth materialism as a mediator, and simultaneously examine the direct and indirect paths. Results of 1018 adolescents (...) illustrate that social attachment discourages unethical beliefs directly, but encourages it indirectly through monetary values. Our multi-group analyses demonstrate a novel paradox: The correlation between parental and peer attachments is smaller in France than in China, but similar across gender. Parents contribute more than peers to social attachment in France, but both carry equal weight in China. There is a negative direct path for the Chinese sample and for girls. Indirectly, parental attachment prevents French teenagers’ unethical beliefs, whereas peer attachment promotes boys’ unethical intention, supporting the notion—bad company corrupts good morals. Across both culture and gender, monetary attitude excites dishonesty consistently for all adolescents. A negative direct path exists for Chinese boys only. Overall, social attachment reduces unethical beliefs. Parental and peer supports shape teenagers’ monetary intelligence and ethical or unethical decision making, differently, across culture and gender. We provide theoretical, empirical, and practical implications to ethical parenting, peer attachment, monetary values, and business ethics. (shrink)

The question of whether females tend to act more ethically or risk-averse compared to males is an interesting ethical puzzle. Using a large sample of US firms over the 1992–2014 period, we investigate the effect that the gender of a chief executive officer has on earnings management using classification shifting. We find that the pre-Sarbanes–Oxley Act period was characterized by high levels of classification shifting by both female and male CEOs, but the magnitude of such practices is, surprisingly, significantly higher (...) in firms with female CEOs than in those with male CEOs. By contrast, our results suggest that following the passage of the punitive SOX Act, classification shifting by female CEOs declined significantly, whilst it remained pervasive in firms with male CEOs. This suggests that the observable differences in financial reporting behavior between male and female CEOs seem to be because female CEOs are more risk-averse, but not necessarily more ethically sensitive than their male counterparts are. The central tenets of our findings remain unchanged after several additional checks, including controlling for alternative earnings management techniques, corporate governance mechanisms, CEO and chief financial officer characteristics and propensity score-matching. (shrink)

We examine the impact of employing a female, versus a male, leader on future (t + 1) donations and operating margin using a sample of 4387 unique nonprofit organizations (NPOs) between 2011 and 2014. Using two-stage and matched sample designs, we find that NPOs headed by female leaders report higher future operating margins but lower future donations. We interpret these findings to mean that female leaders are more focused on fiscal responsibility than fundraising. We also find that female leaders with (...) past fundraising experience attenuate lower future donations, and at commercial nonprofits, female leaders with prior for-profit experience contribute to even higher operating margins. Moreover, while female leaders identified as the founder of the organization increase future donations, they have no effect on future operating margins. Collectively, the results of our study should increase nonprofit boards’ confidence in hiring female leaders thereby narrowing the gender disparity in leadership in the nonprofit sector. This study expands the extant literature by providing initial evidence on the effects of female leaders in NPOs thereby contributing to research exploring gender, diversity, management, and nonprofit executives. (shrink)

Given that women CEOs are usually more risk averse, engage less in opportunistic behavior, and provide higher quality earnings than men CEOs, we argue that firms with women CEOs are likely to face lower operational and information risk and thus enjoy cheaper external funds. Using a large sample of Chinese A-share listed firms operating from 2006 to 2012, we find consistent evidence that Chinese banks tend to impose lower loan costs on firms with women CEOs compared to firms with men (...) CEOs. This effect is more pronounced for non-state-owned enterprises than for state-owned enterprises, for firms without political connections than for firms with political connections, and during non-crisis periods. We do not find any significant effects for firms with women chairpersons, CFOs, or directors. (shrink)

This study focuses on CEO hubris and its effect on corporate unethical behaviour—pollution in particular, and in addition examines critical institutional contingencies [state ownership, political connection and industrial competition] which may moderate this effect. With data from over-polluting listed firms based on the real-time pollution monitoring system in transitional China from 2015 to 2017, we find that CEO hubris is significantly positively related to firm pollution, and that the moderating role of SO is not significant, that PC positively moderates the (...) hubris–pollution relationship and that industrial competition negatively moderates this relationship. These findings contribute to research on the upper echelon theory, institutional theory and the growing literature on emerging economies. (shrink)

The readability of 10-K reports, in terms of linguistic complexity, determines the usefulness of information disclosure for stakeholders, particularly individual investors. Since investors largely depend on the financial communication in 10-K reports, firms have an ethical and legal responsibility to present disclosures in a language investors can understand. However, motivated by self-interest, managers obfuscate such disclosures to mask their own actions and hide unfavourable information. Building on the managerial obfuscation hypothesis grounded in stakeholder-agency and ethical-sensitivity theories, I hypothesize and empirically (...) test the relationship between board gender diversity and the readability of narrative disclosure in 10-K reports. Based on a relatively large sample of Russell 3000 firms for the years 2002–2018, I find a significant positive impact of BGD on 10-K reports’ readability, which in turn improves firm performance. Channel analysis reveals that the findings are driven by female independent directors, and their representation on audit and compensation committees; however, board activity does not appear to drive this relationship. Finally, I find that although gender discrimination in the appointment of directors spurs complex readability, the BGD-readability relationship is consistent in gender-biased and non-discriminant firms. I also check the robustness of our main empirical results in several ways. My study has important regulatory and managerial implications in that corporate governance is an important determinant of the readability of disclosure documents. (shrink)

Through earnings announcements, conference calls, and other press releases, corporate executives have an opportunity to frame the narrative of financial disclosures. Numerous studies have shown that textual tone significantly influences stock returns, suggesting that through word choice, upper management may impact market reaction. In this study, we examine the influence of CEO personality traits on corporate disclosures by analyzing the tone of earnings announcements for a sample of Fortune 500 CEOs over nearly two decades. Our hypotheses are twofold: that qualitative (...) disclosures in firms with narcissistic leaders will be biased upward and the bias will moderate as CEOs becomes older. Our empirical results support these hypotheses and suggest that more narcissistic CEOs tend to reinforce their grandiose self-image by issuing more positive earnings announcements but this desire wanes with CEO age. We also find that the stock market response to the tone of the earnings announcement is less pronounced for more narcissistic CEOs, suggesting the market takes into account the bias in narcissistic CEO announcements. (shrink)

The aim of this paper is to highlight how business schools can improve the ethical behaviour of future managers. It assesses the positions of ethical judgement and ethical intent within a sample of UK business students, together with an analysis of underlying explanatory factors to those positions, such as levels of depression, anxiety, stress, motivation and self-compassion. A range of scales were used to evaluate the ethical stance and psychological characteristics of a group of UK business students. The results indicate (...) that feelings of self-compassion, a sense of self-direction and mental health affect the ethical judgement and intent of students in a range of business and university scenarios. It is recommended that in addition to more formal ethics education, universities consider the mental health and psyche of their students to improve the efficacy of ethical training. (shrink)

Corroborating upper echelons theory, this study picks up the notion that narcissistic chief executive officers take advantage of accounting choices to enhance their firms’—and inherently their own—personal track records. Using a set of 15 indicators, reflecting the narcissistic trait of 1126 CEOs for the period 1992 to 2012, we find evidence of highly narcissistic CEOs engaging in accrual-based earnings management. In contrast to prior research, the results show evidence not only for income-increasing but also for income-decreasing ABEM. This indicates that (...) highly narcissistic CEOs not only strive to influence stakeholders’ perception of current performance. We conclude that they also assess their potential to influence perception of current and future earnings. The results imply that highly narcissistic CEOs’ accounting choices are driven by self-serving behavior rather than by the intention to provide additional information to the market. When earnings management techniques are used to derive personal advantage from the presentation of a firm’s earnings, the literature refers to this as a case of low earnings quality reflecting unethical behavior. Accordingly, this study contributes to the field of business ethics by showing that CEO narcissism is related to low earnings quality in that it is associated to discretionarily decreasing accruals. (shrink)

Is there a compensation gap between female CEOs and male CEOs? If so, are there mechanisms to mitigate the compensation gap? Extending role congruity theory, we argue that the perception mismatch between the female gender role and the leadership role may lead to lower compensation to female CEOs, resulting in a gender compensation gap. Nevertheless, the compensation gap may be narrowed if female CEOs display agentic traits through risk-taking, or alternatively, work in female-dominated industries where communal traits are valued. Additionally, (...) we expect that female CEOs’ risk-taking is less effective in reducing the gender compensation gap in female-dominated industries due to the conflicting emphases on agentic and communal traits. Leveraging a sample of Chinese publicly listed firms, we find support for our hypotheses. Overall, this study contributes to the ethics literature on income inequality issues, by highlighting the effectiveness of potential mechanisms to close the gender compensation gap between female and male CEOs. (shrink)

As demand grows from various stakeholders for responsible management education in business schools, it is essential to understand how corporate social responsibility and RME are perceived by various subgroups of business students. Following the principles of theories on moral orientation and moral development, we examined the role of gender and age in determining four indicators of business students’ moral approach in the context of business schools committed to RME and CSR. Based on nearly 1300 responses to a survey, conducted with (...) the United Nations-supported principles for responsible management education, we show that overall, female students placed a higher value on ethical responsibilities than male students. Female students were also more welcoming than male students regarding curriculum changes that were focused on CSR-related studies. In addition, older age groups ranked transcendent values and positive CSR attitudes higher than younger age groups. We also found that the subgroups of the age variable could better discriminate the differences in choices made by the respondents between the four indicators of students’ moral approach. The implications of our findings to RME, business schools, and other stakeholders are discussed. (shrink)

Employees frequently engage in job crafting to better match their jobs with their personal abilities and skills. Compared with its benefits, the potential detrimental consequences of job crafting have received less attention from researchers. Drawing on relative deprivation theory, we examined employees’ potential negative reactions to coworkers’ job crafting. We proposed that coworkers’ job crafting is positively related to employees’ feelings of relative deprivation, thus reducing prosocial behaviors and giving rise to social undermining. We further argued that employees’ zero-sum mindset (...) moderates the relationship between coworkers’ job crafting and employees’ feelings of relative deprivation, such that the relationship is more positive when the zero-sum mindset is high rather than low. Our hypotheses were generally supported by time-lagged data collected from a sample of 313 employees and their leaders from 85 teams. Our findings advance the understanding of the unintended consequences of job crafting in organizations. (shrink)