In a study conducted by the David Eccles School of Business, a male and female research team found that investors are less likely to back an IPO from a company led by a woman than a company led by a male. This is being referred to as the “Green Ceiling” in the investment world.
In Skirting the Issues: Evidence of Gender Bias in IPO Prospectus Evaluators, the report authors concluded that the “lack of female-led IPOs suggests a potentially larger problem — a gender-based capital gap for new ventures.” Despite the fact that nearly half of all privately held businesses in the United States are owned or led by women, the report explains that there is still a reluctance to invest in IPOs spearheaded by women. The team wrote:
“Despite identical personal qualifications and firm financials, female founders/CEOs were perceived as less capable than their male counterparts, and IPOs led by female founders/CEOs were considered less attractive. Like the glass ceiling of corporate America that has limited the advancement of female managers, female entrepreneurs face a ‘green ceiling’ when it comes to financing. Taken as a whole, our results suggest that gender stereotypes are alive and well and moreover, that such stereotypes impact investment decisions.”
The full study will be published in the Journal of Management in the future, or you can follow the link to download the entire research paper now.
The report was authored by Lyda Bigelow, assistant professor at the David Eccles School of Business; Robert Wuebker, a post-doctoral fellow at the David Eccles School; Leif Lunmark, a doctoral candidate at the David Eccles School; and Judi McLean Parks, a professor of organizational behavior at Washington University’s Olin Business School.
Image: Thomas Picard
Susan Gunelius
Susan Gunelius is the Founder and Editor-in-Chief of Women on Business. She is a 30-year veteran of the marketing field and has authored a dozen books about marketing, branding, and social media, including the highly popular Ultimate Guide to Email Marketing, 30-Minute Social Media Marketing, Content Marketing for Dummies, Blogging All-in-One for Dummies and Kick-ass Copywriting in 10 Easy Steps. Susan’s marketing-related content can be found on Entrepreneur.com, Forbes.com, MSNBC.com, BusinessWeek.com, and more. Susan is President & CEO of KeySplash Creative, Inc., a marketing communications company. She has worked in corporate marketing roles and through client relationships with AT&T, HSBC, Citibank, Intuit, The New York Times, Cox Communications, and many more large and small companies around the world. Susan also speaks about marketing, branding and social media at events around the world and is frequently interviewed by television, online, radio, and print media organizations about these topics. She holds an MBA in Management and Strategy and a Bachelor of Science degree in Marketing and is a Certified Professional Career Coach (CPCC).
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