2020
Working Paper
HBS Working Paper Series

Corporate Leadership and Creditor Recovery Rates: Evidence from Executive Gender

By: Clarissa Hauptmann, Syrena Shirley and Anywhere Sikochi

Format:Print
| Language:English
| Pages:46

Abstract

We examine the relationship between the gender of executives and corporate creditor recovery rates. Using 2,288 defaulted debt instruments, we find that female executives are associated with higher creditor recovery rates. Our findings are robust to tests that correct for potential self-selection inherent in studies of executive gender. We find evidence suggesting that conservatism in financial reporting and risk taking are potential channels through which gender affects creditor recovery rates. In additional tests, we find that the effects of executive gender persist across default types and the 2008 global financial crisis. We also show that gender diversity on the board does not moderate the effect of executive gender.

Keywords

Executive Gender; Default; Recovery Rates; Debt; Corporate Bonds; Conservatism; Leadership; Gender; Borrowing and Debt; Bonds; Risk Management

Citation

Hauptmann, Clarissa, Syrena Shirley, and Anywhere Sikochi. "Corporate Leadership and Creditor Recovery Rates: Evidence from Executive Gender." Harvard Business School Working Paper, No. 20-087, February 2020.