Sexism, Culture, and Firm Value: Evidence from the Harvey Weinstein Scandal and the #MeToo Movement

University of Alberta School of Business Research Paper No. 2019-509

Posted: 2 Oct 2019 Last revised: 1 Dec 2022

See all articles by Karl V. Lins

Karl V. Lins

University of Utah - Department of Finance

Lukas Roth

University of Alberta - Department of Finance and Statistical Analysis; European Corporate Governance Institute (ECGI)

Henri Servaes

London Business School; Centre for Economic Policy Research (CEPR)

Ane Tamayo

London School of Economics & Political Science (LSE)

Multiple version iconThere are 2 versions of this paper

Date Written: October 21, 2022

Abstract

During the revelation of the Harvey Weinstein scandal and the re-emergence of the #MeToo movement, firms with a non-sexist corporate culture, proxied by having women among the five highest paid executives, earn excess returns of 1.6% relative to firms without female top executives. Returns for firms with female top executives are substantially higher in industries with few women in executive positions and in states with greater sexism or a larger gender pay gap. These returns are driven by changes in investor preferences towards firms with a non-sexist culture. Institutional ownership increases in firms with a non-sexist culture after the Weinstein/#MeToo events, particularly for institutions with larger holdings and investors with a lower ESG focus ex-ante. Firms without female top executives improve gender diversity after these events, even in sexist states and in industries with few women executives. Our evidence attests to the value of having a non-sexist corporate culture.

Keywords: Culture, Sexism, Gender Equality, #MeToo, Valuation, Returns, Investor Preferences, Institutional Ownership, ESG

JEL Classification: M14, J16, G12, G30

Suggested Citation

Lins, Karl V. and Roth, Lukas and Servaes, Henri and Tamayo, Ane Miren, Sexism, Culture, and Firm Value: Evidence from the Harvey Weinstein Scandal and the #MeToo Movement (October 21, 2022). University of Alberta School of Business Research Paper No. 2019-509 , Available at SSRN: https://ssrn.com/abstract=3458312 or http://dx.doi.org/10.2139/ssrn.3458312

Karl V. Lins

University of Utah - Department of Finance ( email )

David Eccles School of Business
Salt Lake City, UT 84112
United States
801-585-3171 (Phone)
801-581-7214 (Fax)

Lukas Roth

University of Alberta - Department of Finance and Statistical Analysis ( email )

2-32E Business Building
Edmonton, Alberta T6G 2R6
Canada
780-492-4431 (Phone)

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Henri Servaes (Contact Author)

London Business School ( email )

Sussex Place
Regent's Park
London NW1 4SA
United Kingdom
+44 20 7000 8268 (Phone)
+44 20 7000 8201 (Fax)

HOME PAGE: http://faculty.london.edu/hservaes/

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Ane Miren Tamayo

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom
+44 (0)20 78494689 (Phone)

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