The study did not attempt to address whether stocks of companies with women CFOs outperform or underperform the market generally. So many variables affect stock prices over longer periods of time that being able to convincingly identify the specific effect of a female executive versus other explanations seems unlikely, Kisgen said.
The research did take into account, however, several factors that could have skewed the results. Control variables were used to remove from the data the effects of industry, company size, year of transition to CFO, profitability, and market-to-book ratio. For some tests, additional control variables were used; for example, for acquisition announcement returns, there was a control for whether a deal was friendly or hostile.
The authors acknowledged that hiring practices conceivably could have influenced the results of their study, though they drew no conclusions. They mentioned one study, done 52 years ago, that suggested that a pro-male hiring bias meant women who overcame that bias were of higher than average caliber. By contrast, they also alluded to a 1993 study that argued that affirmative action can lead companies to select employees whose qualifications are lower-than-average.
"We can't completely rule out the argument that some unobserved change in discriminatory orientation ... could explain our findings," the authors wrote, meaning that some unrecognized hiring trend could have skewed their results.
But they also found that to be very unlikely. The study not only used a control group of male-to-male CFO transitions, it also compared the performance of companies with female CFOs with the performance of those same companies when they had male CFOs. That would seem to nullify company-specific aberrations that might have affected the research results.
Meanwhile, even if women are better at maximizing shareholder value, they have some challenges to overcome in getting to the CFO seat. In a June 2006 survey of 363 executives by CFO magazine, 83 percent of men said there was no glass ceiling for women in corporate finance — but only 44 percent of women agreed.
Also, 51 percent of men said that no positions would be harder for a woman to obtain, an assertion with which only 37 percent of women agreed. About 14 percent of survey respondents said CFO is the hardest corporate job for women to reach.
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