Parents know that we shape our children. We teach them right and wrong and instill positive values but the opposite is also true: our kids shape us.
In a newly published piece, Shaped by Their Daughters: Executives, Female Socialization, and Corporate Social Responsibility, Cronvist and Yu examine the link between having a daughter and being a more generous CEO. To undertake this project they look at the 500 Largest first in America (S&P 500) and build a database that links CEO’s Corporate Social Responsibility—which provides insight into how CEO’s make decisions regarding society—and the gender of their children (if any).
As the authors state, “We find evidence of an economically sizable and statistically significant CEO-daughter effect in the context of corporate social responsibility policies, controlling for industry as well as firm and CEO characteristics.”
Specifically they find that the average male CEO with a daughter spends an extra 10% per year of net income on CSR. Or put another way the effect makes this male CEO “about one-quarter of the CEO herself being female.”
What is the reason? The authors speculate that women have stronger feelings towards equality and helping others and that CEO’s internalize their daughters preferences.
Family environment—specifically, having a daughter—has direct and real implications for some of the most powerful men in America. If you believe large corporations have a duty to the environment, diversity, and the community they work in, then having a female CEO might be best. Second best appears to have a male CEO with a daughter.
Shaped by Their Daughters: Executives, Female Socialization, and Corporate Social Responsibility
Journal of Financial Economics (JFE), 2017
Henrik Cronqvist & Frank Yu