During the financial crisis of 2008, it was widely cited that a greater presence of female managers in the financial industry would have resulted in more ethical behaviors. Research from Karlsruhe Institute of Technology (KIT) reinforces that point, as they suggest that female bosses are more likely to pay employees fairly than their male peers.

“Our study shows that the respective incentive system, work experience, and especially gender have an influence on what wages managers set for their employees,” the researchers explain.

Fair pay

The researchers recruited several hundred volunteers and divided them between “managers” and “assemblers”. The assemblers were required to screw 100 ballpoint pens together and then apart again, with the task generally taking more than an hour. The managers then determined the appropriate pay for this task, with options of anything up to €21.

The gender-related differences were particularly prominent in this allocation of payment, as the results showed that managers would often try to keep as much of the money for themselves as possible. Indeed, on average they paid out just €7.59 per assignment.

When self-interest was removed from the equation, and any remaining sum went to research rather than themselves, however, they increased this by 46% to €11.10. The results show that female managers were typically much more consistent.

“If they could keep the rest of the 21 euros for themselves, they set 8.54 euros as the assembly wage. If the rest of the 21 euros went to research, they considered 9.44 euros to be appropriate,” the researchers explain.

“Various studies observe that women make more selfless and moral decisions than men. However, we were shocked at how drastic the discrepancy was here,” they conclude. “Our study shows that diversity in the executive ranks is important if the atmosphere in a company is to be appreciative and wage inequality is to be limited.”