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Do women managers keep firms out of trouble? Evidence from corporate litigation and policies

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  • Adhikari, Binay K.
  • Agrawal, Anup
  • Malm, James

Abstract

We find that firms where women have more power in the top management team, measured by female executives’ plurality and pay slice, face fewer operations-related lawsuits. This effect is robust to several treatments of endogeneity and does not appear to be driven by female executives' greater willingness to settle the cases. Evidence from a simultaneous equations approach suggests that firms where women executives have more power avoid lawsuits partly by avoiding some risky but value-increasing firm policies, such as more aggressive R&D, intensive advertising, and policies inimical to other parties.

Suggested Citation

  • Adhikari, Binay K. & Agrawal, Anup & Malm, James, 2019. "Do women managers keep firms out of trouble? Evidence from corporate litigation and policies," Journal of Accounting and Economics, Elsevier, vol. 67(1), pages 202-225.
    • Handle: RePEc:eee:jaecon:v:67:y:2019:i:1:p:202-225
    DOI: 10.1016/j.jacceco.2018.09.004
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