Watching the Glass Ceiling: An Investigation of Financial Presentation Modality and Gender Bias

• In Event: Investors' Perceptions of Management

Abstract

Using a modestly positive public company’s financial review as a template, we reconstruct an investor-directed financial review in order to manipulate (1) presentation modality (text vs. video), (2) the gender of the executive delivering the video review, and (3) the type of company being reviewed (a relatively ‘masculine’ company vs. a relatively ‘neutral’ company). As predicted by Expectation States Theory (Ridgeway and Bourg 2004), after reviewing identical quantitative information, research participants with investment experience believed company management was more competent when information was delivered by a male CEO (via video) relative to the beliefs of participants who received identical information from a female CEO (via video) or from a ‘genderless’ transcript. Beliefs about management’s competence did not fully mediate expectations about future company performance: having an audible/visible male CEO was significantly associated with enhanced expectations of future company performance after controlling for perceived CEO competence. When we restricted our analysis to the relatively ‘masculine’ company, future company performance expectations were at their lowest point when a female CEOs delivered information (lower than both male-video-CEO and the genderless-text-transcript-CEO). Ridgeway (2011) rightfully questions how gender inequality can persist in the modern world. Our findings offer a partial explanation and a subtle challenge to gender equality at the executive level: given that the perceptions of investors and potential investors matter to the success of public companies, how can outsider bias be overcome?

Authors

• Steve Buchheit, University of Alabama

• Cristina Bailey, Texas Tech University

• Kevin Kim, Texas Tech University