“Can compensation systems alleviate gender discrimination in auditing teams? Evidence from a a lab experiment”

Abstract

One of the main manifestations of gender discrimination in the workplace occurs in the process of recruiting and hiring women. Among the causes of this discrimination, prior literature addresses the psychological traits of the managers who deal with these processes. On numerous occasions, those who recruit, and hire are not fully aware that they may be incurring situations of discrimination, which do not necessarily represent the best interests of the organizations for whom they select and appoint these female professionals. This can result in companies facing significant talent losses, reducing residency levels, non-compliance with their commitments to SDGs, ESG, and DEIs, and decreasing their ability to attract investments. In this paper, we present the results of an experiment carried out among 209 students. These results how that the most optimistic female participants about social mobility include less women in the work teams. Male participants with less exposure to daily discrimination also incur gender discrimination. This effect is mainly kept when the compensation systems reward the salary difference for gender reasons. Participation in the experiment allows students to take a position on the existence of subtle biases, normally unknown to these people and that, with a high probability, they will not want to accompany them in their future working lives. These results are not only interesting for researchers and practitioners. They address the importance of teaching actively committed to the SDG, the knowing of ESG and DEI values versus the traditional focus on financial rewards. There is wisdom inherent in striking a good balance between monetary and non-monetary incentives for future managers. In summary, this experiment is an important instrument to convey in the classroom that discrimination decreases when its causes are identified, and solutions are applied within the framework of ESG and DEI strategies.

One of the main manifestations of gender discrimination in the workplace occurs in the process of recruiting and hiring women. Among the causes of this discrimination, prior literature addresses the psychological traits of the managers who deal with these processes. On numerous occasions, those who recruit, and hire are not fully aware that they may be incurring situations of discrimination, which do not necessarily represent the best interests of the organizations for whom they select and appoint these female professionals. This can result in companies facing significant talent losses, reducing residency levels, non-compliance with their commitments to SDGs, ESG, and DEIs, and decreasing their ability to attract investments. In this paper, we present the results of an experiment carried out among 209 students. These results how that the most optimistic female participants about social mobility include less women in the work teams. Male participants with less exposure to daily discrimination also incur gender discrimination. This effect is mainly kept when the compensation systems reward the salary difference for gender reasons. Participation in the experiment allows students to take a position on the existence of subtle biases, normally unknown to these people and that, with a high probability, they will not want to accompany them in their future working lives. These results are not only interesting for researchers and practitioners. They address the importance of teaching actively committed to the SDG, the knowing of ESG and DEI values versus the traditional focus on financial rewards. There is wisdom inherent in striking a good balance between monetary and non-monetary incentives for future managers. In summary, this experiment is an important instrument to convey in the classroom that discrimination decreases when its causes are identified, and solutions are applied within the framework of ESG and DEI strategies.