A new report suggests a possible exception to the prevailing gender pay gap in the U.S., namely that at the chief executive level, it disappears.
While cultural change is in the air, and some companies have taken steps to address the pay gap between men and women, women still earned 82% of what their male counterparts earned in 2017, according to a report from Pew Research Center. The pay gap has narrowed since 1980, but remained relatively stable over the past 15 years.
A look at the CEO level offers a different picture. A study released in March by researchers at the University of Alabama and University of Mississippi found no pay gap between male and female CEOs at publicly traded companies. The authors built on a 2015 report from Hill, Upadhyay and Beekun (HUB), which concluded that female CEOs actually receive greater compensation than male CEOs. Noting that “there are several reasons to be skeptical of HUB’s revelations,” the authors sought to re-examine the previous research, using a larger sample over a longer period of time, as well as more rigorous analytical tools. “Our results reveal that there is no significant difference between male and female CEO compensation,” they concluded.
Of course, this does not suggest that the gender pay gap has improved overall, or that more women are winning CEO appointments, the New York Times reports. Citing a 2017 article in the Wall Street Journal, which also made the claim that female CEOs earn more than male CEOs, Fortune magazine wrote that “such stories suggest that America’s biggest corner offices are a haven for gender equity — which does not appear to be the case.” The Wall Street Journal’s conclusion was based on a sample of only 21 female executives, compared with 382 men.
The new study on gender parity in CEO compensation, on the other hand, was exhaustive. “We controlled for several possible confounding factors,” the authors wrote in a post on a Harvard Law School website. They explained that, for example, their model accounted for the fact that chief executive compensation and the number of women in the CEO role have increased over time.
One possible explanation as to how women CEOs have managed to bridge the pay gap is that because there is a more limited supply of women in the chief executive role, a premium has been applied. Another factor, one of the study’s authors suggested, could be the high profile of the chief executive role. “We think it is a visibility issue,’’ he said.
Women do face more of an uphill battle in making it to the top, however. Joanne Lipman, author of That’s What She Said: What Men Need to Know (and Women Need to Tell Them) About Working Together, pointed out that “female CEOs face a host of obstacles that male CEOs do not.’’ Lipman cited statistics showing that female chief executives are more likely to be blamed for poor performance; that they are disproportionately hired as chief executives in times of crisis; and that they are targeted by activist investors more often.
