New research suggests that companies whose CEOs have daughters receive significantly higher ratings for corporate social responsibility (CSR) than those who have sons.
A recent study by Henrik Cronqvist of the University of Miami and Frank Yu of China Europe International Business School found that male CEOs of S&P 500 companies with daughters received 12 per cent higher CSR ratings than those with only sons. These firms were also found to be spending 13.4 per cent more of their net income on CSR than the median.
"They seem to care more about others than just shareholders,” explained Cronqvist in an interview with Harvard Business Review.
Cronqvist and Yu assembled a database of S&P 500 CEOs with children covering 1992-2012 and then compared it to corresponding CSR data from analytics firm KLD for each company.
Male CEOs with daughters performed above the median in all six CSR categories examined by KLD, but especially when it came to diversity.
The study also showed that when a CEO with daughters was changed to one without, the firm experienced a decline in CSR performance across the board.
The researchers explained their findings by pointing to research suggesting that “women may exhibit stronger other-regarding preferences compared to men,” as in women tend to care more for the well-being of others. This contributes to the “female socialization hypothesis” – the idea that parents internalize the preferences of their daughters. Recent research examining the records of judges and congressmembers with daughters has found a similar correlation.
With the average age of the CEOs being 57, the majority of the daughters would have been old enough to express their own viewpoints.
Having more than one daughter did increase CSR performance, but it was more important that the first-born child be female.
There were two important groups with insufficiently large sample sizes to draw any conclusions from: female CEOs and those without children. Less than five per cent of CEOs had no children, while only 14 of the 379 executives were women.