Zhanel DeVides, assistant professor of accounting at Penn State Abington, was recently named a recipient of the Fulbright-University of Vaasa Scholar Award to conduct research on an international scale this fall. Her project at the Finnish university explores how the gender of corporate managers influences market expectations for future earnings.
“I am uniquely qualified to pursue this area due to my previous research in earnings strings, disclosure practices, and financial intermediaries in the U.S. capital markets. It dovetails with the University of Vaasa’s faculty expertise on Finnish institutional and cultural practices on gender diversity, financial reporting, and earning management,” DeVides said.
DeVides is collecting data on executives who provide information to investors and analysts and examining the differences in terms of how the market reacts to messages from female versus male executives. Managers who consecutively report earnings that beat expectations generate earnings strings, which are associated with higher firm valuations by investors and executive compensation.
No prior study, according to DeVides, has examined whether gender plays a role in achieving earnings strings through its effect on the likelihood of consistently reporting earnings above analysts’ forecasts via voluntary managerial guidance.
The results of this study will shed light on behavioral differences in managing market expectations between female and male executives and highlight challenges that even the highest-ranking female executives might experience in garnering attention and influence for their communications.
“I hope that this project will foster an exchange of ideas and collaborative research with faculty at the University of Vaasa, which ultimately will help promote gender equality and women’s empowerment in the corporate sector around the world,” DeVides said.
DeVides said Finland is an ideal location for her work since the country is a leader in gender equity. According to the 2022 World Economic Forum, Finland is ranked second out of 146 countries in terms of gender parity. Finland has one of the highest percentages of female directors in the world despite not having mandatory quotas for women’s representation on corporate boards.
She said she hopes her work will lead to future collaborations in areas such as sustainability and social capital, which are important to her Finnish colleagues, Penn State, and the American research community at large.
For all the latest news, follow us on Facebook or sign up for Glenside Local’s “Daily Buzz” newsletter here.