By |Published On: November 27th, 2017|Categories: Basilico and Johnsen, Academic Research Insight|

Shaped by their daughters: Executives, female socialization, and corporate social responsibility

  • Henrik Cronqvist, Frank Yu
  • A version of this paper can be found here
  • Want to read our summaries of academic finance papers? Check out our Academic Research Insight category.

What are the research questions?

Research in social science has recently demonstrated the importance of the family environment for an individual’s behavior. Not only parents impact their children, but the opposite is also true. Additionally, there is a long-standing debate in economics and social psychology on whether women exhibit stronger social preferences compared to men. A pioneering study in sociology ( Warner, 1991) predicts that men parenting daughters may adopt preferences more similar to those of females.
Specifically, the authors investigate the following:
  1. Does a top decision makers’ (CEOs) family environment have a real impact on the firm they manage? Specifically, is there a CEO-daughter effect in the context of corporate social responsibility policies? That is, do male CEOs with daughters exhibit a higher propensity of managing firms that engage more in pro-CSR practices?

What are the Academic Insights?

By studying the largest public firms in the US from 1992 to 2012 and hand-collecting information on CEOs’ children, the authors find what follows:

  1. Yes, there is an economically sizeable and statistically significant relationship between a CEO parenting a daughter and corporate social responsibility policies. In particular, the CSR rating of a firm is 9.1% higher, compared to a medium firm, when a firm’s CEO has a daughter. In other words, the median firm with a CEO who has a daughter spends 10.4% per year of the firm’s net income on corporate social responsibility ( about an extra $43.5 million per year). An interesting corollary is that out of several CSR categories, the effects are stronger for Diversity, Environment, and Employee Relations

This result is robust to several endogeneity concerns.

Why does it matter?

This study is the first to emphasize the importance of the family environment in shaping CEOs. (Here is another piece on the subject).

The Most Important Chart from the Paper


The results are hypothetical results and are NOT an indicator of future results and do NOT represent returns that any investor actually attained. Indexes are unmanaged and do not reflect management or trading fees, and one cannot invest directly in an index.


Corporate executives managing some of the largest public companies in the U.S. are shaped by their daughters. When a firm’s CEO has a daughter, the corporate social responsibility rating is about 9.1% higher, compared to a median firm. The results are robust to confronting several sources of endogeneity, e.g., examining first-born CEO daughters and CEO changes. The relation is strongest for diversity, but significant also for broader pro-social practices related to the environment and employee relations. Our study contributes to research on female socialization, heterogeneity in CSR policies, and plausibly exogenous determinants of CEOs’ styles.

About the Author: Wesley Gray, PhD

Wesley Gray, PhD
After serving as a Captain in the United States Marine Corps, Dr. Gray earned an MBA and a PhD in finance from the University of Chicago where he studied under Nobel Prize Winner Eugene Fama. Next, Wes took an academic job in his wife’s hometown of Philadelphia and worked as a finance professor at Drexel University. Dr. Gray’s interest in bridging the research gap between academia and industry led him to found Alpha Architect, an asset management firm dedicated to an impact mission of empowering investors through education. He is a contributor to multiple industry publications and regularly speaks to professional investor groups across the country. Wes has published multiple academic papers and four books, including Embedded (Naval Institute Press, 2009), Quantitative Value (Wiley, 2012), DIY Financial Advisor (Wiley, 2015), and Quantitative Momentum (Wiley, 2016). Dr. Gray currently resides in Palmas Del Mar Puerto Rico with his wife and three children. He recently finished the Leadville 100 ultramarathon race and promises to make better life decisions in the future.