FEMALE CEOS JUDGED MORE HARSHLY FOR ETHICAL FAILURES

Female leaders, however, receive less negativity for general business failures

Women CEOS do not always have it easy as researchers have found that people are less likely to support an organisation after an ethical failure if the business is helmed by a female.

Female leaders, however, receive less negativity for general business failures, said the study published in the Journal of Personality and Social Psychology.

“Our study found that consumers’ trust in, and willingness to support, an organisation after a failure varied based on the gender of the organisation’s leader and the type of incident,” said lead author of the study Nicole Votolato Montgomery of the University of Virginia in the US.

“Women incur greater penalties for ethical transgressions because of persistent gender stereotypes that tend to categorise women as having more communal traits than men, such as being more likable, sensitive and supportive of others,” Nicole Votolato said.

Across three experiments, the researchers examined how gender would influence perceptions of female-led and male-led organisations after experiencing a competence failure, such as a product flaw, or an ethical failure, such as if the product flaw was known but not disclosed to the public for a long period of time.

In the first experiment, 512 participants read a business news article about an auto manufacturer and then filled out a survey about their intent to buy a vehicle from the company.

One-third of the participants read about an ethical failure, one-third read about a competence failure and the final third only read the company description.

Afterward, the participants were asked how

likely they were to purchase a car from the company the next time they were in the market for a vehicle and reported their trust in the organisation.

“When participants were told that the company had previously been made aware of a fuel sensor problem and failed to take immediate action, an ethical failure, they reported

less intent to purchase from the company when the CEO was a woman than when the CEO was a man,” said Montgomery.

“However, when participants were told that the company was previously unaware of the product issue, a competence failure, they reported greater intent to buy the products when the CEO was a woman than when the CEO was a man.”

The purchase intentions for the group that read only the company description did not vary based on the CEO’S gender.

The findings of the other two experiments further demonstrated how gender stereotypes play a vital role in shaping our expectations of leaders and their organisations.