Executive gender pay gaps: the roles of board diversity and female risk aversion

Carter, M E, Franco, F and Gine, M (2017) Executive gender pay gaps: the roles of board diversity and female risk aversion. Contemporary Accounting Research, 34 (2). pp. 1232-1264. ISSN 0823-9150


Using a large sample of executives in S&P 1500 firms over 1996-2010, we document significant salary and total compensation gaps between female and male executives and explore two possible explanations for the gaps. We find support for greater female risk aversion as one contributing factor. Female executives hold significantly lower equity incentives and demand larger salary premiums for bearing a given level of compensation risk. These results suggest that females’ risk aversion contributes to the observed lower pay levels through its effect on ex ante compensation structures. We also find evidence that the lack of gender diversity on corporate boards affects the size of the gaps. In firms with a higher proportion of female directors on the board, the gaps in salary and total pay levels are lower. Together, these findings suggest that female higher risk aversion may act as a barrier to full pay convergence, despite the mitigating effect from greater gender diversity on the board.

More Details

Item Type: Article
Subject Areas: Accounting
Date Deposited: 28 Nov 2016 15:37
Subjects: Women
Top management
Last Modified: 26 May 2024 01:53
URI: https://lbsresearch.london.edu/id/eprint/719

Export and Share


Full text not available from this repository.


View details on Dimensions' website

Downloads from LBS Research Online

View details

Actions (login required)

Edit Item Edit Item