Better in the Shadow? Public Attention, Media Coverage and Market Reaction to Female CEO Announcements.
Combining media coverage data from approximately 17,000 unique outlets with the full population of CEO appointments for US publicly traded firms between 2000 and 2015, we investigate whether female CEO appointments garner more attention compared to male appointments, and if so, whether this increased attention can help make sense of the previously reported negative market reaction to these events. Contrary to prior reports, our data do not indicate that the appointments of female CEOs elicit negative market responses, on average. Our results do highlight an important moderating role of attention, however. We demonstrate that greater media coverage—even when exogenously determined—contributes to negative market reactions for female CEO appointments but positive market reactions for male CEOs, all else held constant. Additionally, female CEO appointments that attract little attention garner significant positive responses in the market, compared to both male CEOs drawing comparable, limited attention and female CEOs that draw high levels of attention. Our results help to reconcile contrasting empirical findings on the effects of gender in executive leadership and parallel recent work on anticipatory bias and second-order discrimination in alternative empirical contexts. Implications for research on attention, gender bias, and executive succession are discussed.