Dear Aarugonda

I think there will be difference between CEO gender to the bank risk and stock prices due to the way they manage bank.

But, i worry about the ethics in this topic? for example, if you find that the man or woman is better for bank risk and stock prices => your policy implication is using only man or woman => that is not about our policy in gender equality.

Of course, some of paper has evaluate the effective of the women participation into the labor, but it supports for the gender equality in the labor market, we can not do this in this field.

Best

Canh

see this article https://faculty.haas.berkeley.edu/odean/papers/gender/BoysWillBeBoys.pdf

Some experiments predict that men are on average more overconfident and this may lead to more risk taking. However I don't think that it applies to all situations, since many times in life if you choose to do something and you are a good guy, the surrounding environment may induce you to adapt and become a risk taking guy. 

In my personal opinion, it's all about incentives, whoever you put as a CEO of a bank if there are incentives to accumulate risk people will tend to do it. 

Anyway, many companies around the world are including women in their board and some countries if I am not mistaking offer tax incentives for companies which include women in their board.

Dear Kotishwar,

There are numerous studies indicating that female directors have the effect of reducing firms’ risk (I do not think we should expect differences between financial and non-financial companies).

However, becoming CEO is a different matter. Only very specific people (especially women) achieve this top opposition. We might consider that for a woman to reach this position she has to prove first that she is more “tough” than a male CEO. Being more difficult (and rare) for a woman to become CEO it is probable that female CEOs might be more competitive individuals than their male counterparts.

There might be also some endogeneity issues related to the selection of female CEOs. Poor performing firms might choose female CEOs as a way to signal the market a radical turn around strategy. Therefore, risky and poor performing companies might be more prone to choose female CEOs. In this way, we might find that female CEOs are associated to  high risk.

Although you might find an association between female CEOs and firms risk, it is interesting to analyze their effect on specific firm’s investment and financing strategies that have an effect on the firms’ total risk. Here you might find some mediating effects.

Kind regards

Carlos Fernández

Dear Kotishwar ,

people are more interested in money not in CEO's gender, investor invest according to performance of the bank so CEO gender rules out with bank risk and stock price

Finance literature suggest three types of behaviors namely risk averse, risk indifferent and risk seeker. it depends on  the behavior of CEO either he/she is risk averse, risk indifferent or risk seeker. Some women may be more bold in decision making process than men. In contrast, some men may be more confident in their decision making process than women. It is a God gifted feature. So gender classification may be having an impact on decision making process.

Dear Kotishwar,

Gender different can be influenced in the workplace. Most of the company want man worker than woman . for example, man worker for industrial part. But gender CEO of bank cannot influence the bank rick and stock price. U mean that the CEO decision can be effect to go down/up the stock price or bank risk. I think that it can related with the management of CEO knowledge. This decision can come not only Woman but also man. all are base on management but not gender.

I would also like to get clarification on proxy for bank risk. Which are the parameters intended to measure bank risk?

Different parameters may land with diverse inferences.

Hi,

This article can be useful:

Palvia, Ajay, Emilia Vähämaa, and Sami Vähämaa. 2015. “Are Female CEOs and Chairwomen More Conservative and Risk Averse? Evidence from the Banking Industry during the Financial Crisis.” Journal of Business Ethics 131 (3): 577-594.

Best,

Fabrizio

This is a really interesting question and I wish you every success with your research. I think what may be interesting and pertinent to examine in this context is the extent to which the organisation under consideration is gendered in terms of its culture. Investigating only whether the CEO is male or female may not tell the full story. Similarly, as alluded to in one of the previous answers, considering context in terms of timeframe is important. For example, during times of economic or financial crisis women in male spaces such as banking (who normally face ongoing barriers to leadership) are often portrayed as 'favourable leaders' as compared with their male peers (see glass cliff theory).

I think both of them are related