Do Women Managers Keep Firms out of Trouble? Evidence from Corporate Litigation and Policies
64 Pages Posted: 7 Jul 2015 Last revised: 25 Sep 2018
Date Written: September 24, 2018
We find that firms where women have more power in the top management team, measured by female executives’ plurality and pay slice, face fewer operations-related lawsuits. This effect is robust to several treatments of endogeneity and does not appear to be driven by female executives' greater willingness to settle the cases. Evidence from a simultaneous equations approach suggests that firms where women executives have more power avoid lawsuits partly by avoiding some risky but value-increasing firm policies, such as more aggressive R&D, intensive advertising, and policies inimical to other parties.
Keywords: Women executives, Corporate litigation, Corporate policies
JEL Classification: G39, K41, Z10
Suggested Citation: Suggested Citation