BL Magazine

Business
Words:
Kirsten Morel
Those companies
run by a CEO with
at least one
daughter scored
on average 11.9
per cent higher
on standard CSR
measures than
those without
ONCE UPON A TIME, Queen Elizabeth I led her
country to a famous victory. Five hundred years later,
it was Winston Churchill’s turn to become a great
leader. Today, however, we defer not to our national
leaders, but to the likes of Bill Gates and Steve Jobs –
corporate leaders who looked to conquer the
world… and won.
There’s no shortage of media coverage when it
comes to how and why fêted CEOs make it to the
top of their field. They are portrayed as great people
(often men) who have an X-factor ability to motivate
people and take the crucial, difficult decisions that turn
small companies into major multinationals.
The ‘lone hero with a vision’ story is one that the
media adores and continually falls back on, but rarely
do they look behind the scenes to see just how the
CEO’s decisions are being made or, perhaps more
importantly, influenced.
Recently, two university professors attempted to
lift the veil that so often covers decision-making by
looking at the influence of family members – and
more specifically, daughters – on the decisions that
are taken by CEOs.
Taking the companies in the S&P 500 as their test
bed, Professors Henrik Cronqvist of the University of
Miami and Frank Yu of China Europe International
Business School analysed the effect that
having a daughter has on the socially
focused activities of major US companies.
The researchers were able to find
information about the gender of the
children of 379 CEOs of S&P 500
companies and compared this information
with the social responsibility ratings of the
companies they run.
Their findings were quite clear – those
companies run by a CEO who has at least
one daughter scored on average 11.9 per
cent higher on standard CSR measures
than those who do not. The companies
also spent more than 13 per cent more
on CSR than those run by CEOs who
have only sons or no children.
If daughters do have a quantifiable
effect on their CEO parents, it begs the
question ‘why?’. According to Professor Yu,
it’s all a matter of perspective. “Our study
gives credibility to the female socialisation
hypothesis, which says that living and interacting
with females helps the male see the world from a
female’s perspective.”
The female socialisation hypothesis is more than
just a theory; it works in practice, according to
Alice Merry, daughter of Chris Merry, the CEO of
Ipes. She is clear that “boys who have grown up with
sisters tend to be nicer to women than those who
don’t”. [See box on page 42]
Her father agrees that if you grow up with sisters
in your family – and then go on to have daughters later
– you’re much more likely to have an understanding
of the female perspective.
GRADUAL INFLUENCE
Professor Yu also points out that the effects aren’t
likely to happen instantly, the day a business leader’s
daughter is born. “It doesn’t happen right away. People
have tested this with judges and senators in the US and
there is evidence to show that those with daughters
display more ‘female’ ways of working,” he says.
“In the study, we weren’t able to test whether
the effects are felt by a certain age – just identifying
whether a CEO had a child was challenging – but our
guess is that these effects take place over time.”
Yu and Cronqvist’s study showed that companies
led by CEOs with daughters score above the median
in every CSR category: diversity (+13.4 per cent),
community (+6.5 per cent), employee relations
(+6.3 per cent), product (+6.0 per cent), environment
(+4.6 per cent) and human rights (+1.0 per cent).
The fact that diversity heads this list may be a
reflection of the most common experiences associated
with parenting a daughter.
“You translate your own experiences back and if
you see your daughter having difficulty finding work,
you wouldn’t want to see that reflected in your own
business,” explains Chris Merry.
He points out that emotional intelligence is not easy
to learn in the classroom. Taking this into account with
the study, there is an implication that the long-term
experience of living with women may more effectively
open minds to a greater range of perspectives.
Interestingly, Yu and Cronqvist have sought to
quantify the effect that a daughter has on a male CEO
by comparing them with female CEOs.
“Having a daughter gives a male CEO about onethird
more towards the social responsibility levels of
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www.blglobal.co.uk january/february 2016 41