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Corporate Gender Culture

Abstract:

We apply computational linguistic models to Australian publicly listed firms' reports to a gender-equality statutory agency to construct the first systematic measure of ‘corporate gender culture'—firms' practices pertaining to the treatment of women across a range of dimensions, from recruitment and promotion to maternity leave and sexual harassment. While different practices are associated with female representation at different levels of the hierarchy (employees, managers, executives, board), the practice most robustly associated with firm performance consists in human capital formation opportunities open to all. We use a unique historical experiment that durably shaped gender norms in Australia to establish that: (i) corporate gender culture is shaped by local societal gender norms; and (ii) the relationship between corporate gender culture and firm performance is likely causal. Upon examining the impact of the introduction of government-funded parental leave in 2011, we observe that culture evolves slowly, but policy can shape gender diversity and corporate gender culture.

Keywords: Gender corporate culture, firm performance, gender diversity, computational linguistics