A recent report in finds that some of America’s largest corporations spend an additional $59.5M per year on corporate social responsibility (CSR), and the researchers claim that this is because they are run by CEOs with daughters. It appears that whenever a business leader has a daughter, the company is “much nicer” to employees.
The research is the work of fi nance professor Henrik Cronqvist of the University of Miami and Frank Yu of the China-Europe International Business School (CEIBS), and studied 379 CEOs of the S+P 500 index who had among them a total of 943 children, 48.7% of whom were girls (comparable to the statistical standard in the general population). The study focused on the years 1992-2012; 3.7% of the CEOs were female.
The study discovered that having a female child impacts the ways that CEOs manage their companies, and that the effect is amplified if the daughter is the CEO’s first-born. Hiring a new CEO with a daughter is said to lead to increased CSR related activity. Moreover, companies with good CSR track records are more likely to hire new CEOs with daughters.
According to the study, CEOs with daughters typically show a stronger attachment to society in general, as well as increased empathy for the well-being of stakeholders, spending approximately 13.4% of the firm’s net income on CSR-related matters. It also discovered that male CEOs with female children are almost 33% more likely to make CSR-related decisions similar to those made by female CEOs.
The researchers noted that CEOs with sons do not exhibit the same tendencies at work as those with daughters.
The differences were most notable in the ways in which companies treated minorities, women and the disabled, as well as the way in which companies viewed society-atlarge – for example, how stakeholders were treated – whether or not the stakeholders were also shareholders in the company. They also saw that firms that go from having a CEO with a daughter to one that doesn’t are subject to noticeable negative changes in these types of CSR-related activities.
Put another way, having daughters seemed to make male CEOs more nurturing and more protective – more
than their female counterparts. The implication is that children can have as much effect on parents’ behavior
and attitudes as parents have on their children.
As Fred Paglia, former (pre-Heinz) president of food service and U.S. growth channels at Kraft Foods told the researchers: “My girls are 14 and 12, and to be genuine with you, I wake up every day and look into their eyes before I leave for work and try to make the path a little easier for them. What father wouldn’t want to do that?”
‘Shaped By Their Daughters: Executives, Female Socialization, and Corporate Social Responsibility’