Banks favor women CFOs, study says
Thursday, December 29, 2011
financial officers secure lower bank-loan prices than their male counterparts,
according to a new study from Rensselaer Polytechnic Institute.
Looking at a sample of S&P 1500 companies over more than 10
years, RPI found companies with women finance chiefs received loan rates 11
percent lower than companies with male CFOs. Women also won loans with longer
maturities and were less frequently required to provide collateral, according
to a report by CFO magazine.
Women CFOs may have more luck with bank loans because they tend to
be more risk-averse -- and banks know it, according to the study’s authors.
Earlier research showed companies with female CFOs tend to use more conservative
accounting policies and issue debt less frequently, CFO reported.
Women served as the top finance executive at just 104 of the
S&P 1500 by 2006, the end period covered by the study. At the start of the
study period in1994,
there were only four female CFOs in the group.The gender of CEOs and
other top executives did not have the same effect on loan contract terms as did
the gender of CFOs. That suggests banks may view CFOs as the key risk factor in
lending decisions, the study said.
2009 CFO reported on a study that concluded the stock markets react more
favorably to both acquisition announcements and secondary equity offerings made
by companies with female CFOs.