Gender and Executive Compensation in S&P Listed Firms

Abstract

We examine if gender gap exists in total executive compensation for S&P1500 listed firms from 1992 to 2004. We also investigate if this difference exists in the case of new technology firms, where high scholarship is required for executive positions both for men and women. Additionally, we analyze weather the factors that explain executive compensation for men versus women are the same for S&P listed firms during the sample period.

Our results reveal that women represent only 1.12% of total executive sample in 1992 but it increases to 6.15% in 2004. We also find that the gap between men and women compensation exists but is reducing in later years; the forms of executive compensation for men versus women are different; and in the case of new technology firms the differences in total compensation are not statistically significant.

Although women have been considered more risk averse than men, but shareholders continue to pay women with a similar percentage of risk compensation components, like stock options and restricted stocks, than men. It seems that the shareholders are ignoring to take this factor into account when developing compensation packages for women and men.

Finally we also find that the factors that explain women and men total compensation are not the same for S&P1500 listed firms.

Keywords: executive compensation, gender

JEL Classification: G3, J3