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08.23.134:45 AM ET

Do Female CEOs Behave More Ethically?

New research shows that in both politics and the private sector, women tend not to get involved in torrid scandals. Tiffanie Wen reports on the research into the ethics of women in the boardroom.

Yes, women have had their share of political sex scandals, including those of Congresswoman Sue Myrick and former Congressional candidate Krystal Ball. But women's scandals seem limited to long-term affairs with married men or the occasional "racy" Halloween costume—there's a distinct lack of Carlos Dangers, illegitimate children with longtime housekeepers and chasing mistresses to Argentina.

At least one study has shown that women cheat on their romantic partners just as much as men in the general population, so how come high-profile women don't seem to get entangled in these wild—at times, unbelievable—types of scandals?

With regards to Washington, the running theory seems to hinge on the differing motivations that men and women have for entering politics in the first place.

"Our research shows that women enter politics because they care passionately about an issue. Women decide to run because they've trying to effect change on the outside and at some moment, realize the place where they can have the greatest impact is by being on the inside," said Debbie Walsh, the Director of the Center for American Women and Politics at Rutgers University. "A lot of men on the other hand, articulate their motivations in terms of wanting a career in politics."

But while relevant to women in politics, this theory doesn't explain why women also seem to display more ethical behavior in the private sector.

In a study published in April, researchers at Penn State and Washington State examined 83 cases of corporate fraud and 436 defendants indicted by the Corporate Fraud Task Force. Although women had fewer opportunities to engage in corporate fraud (either because they were less visible in high ranking positions or because they were excluded from participation in criminal enterprises), it's telling that while nearly three out of four cases of corporate fraud involved all-male networks, not one single case involved a woman working on her own or a group of women conspiring together, and there was only one mixed-sex group that featured a female ringleader.

Why women tend to act more ethically than men in the private sector is the million dollar question, according to more than one expert interviewed for this story. And it’s one that a lot of researchers are working to answer.

One of those researchers is Laura Kray, a Professor at the Haas School of Business at Berkeley. In a recent series of four studies, she and colleague Michael Haselhuhn demonstrated that, in various negotiation scenarios, men became more ethically "lenient" in their decision making, while women stayed remarkably stable.

"The masculine nature of negotiations—meaning the belief by men that negotiations are a masculine domain that men participate in—means that masculinity is on the line in a way that femininity is not. Even with all things being equal, in a gender-neutral task, we know that masculinity is more fragile than femininity. So when men are in a domain where they are concerned about proving their masculinity, it leads them to engage in negotiation tactics that are more ethically lenient," she said.

While men changed their ethical standards depending on which role they played in a scenario, or who it was that did the lying, for example, women's ethical codes stayed consistent throughout the manipulations. "Women were able to maintain a high level of ethical standards irrespective of what their self-interest was," said Kray.

Kray also suspects that the different ways in which men and women experience emotion could help explain the difference in their ethical behavior. Kray is currently exploring this relationship with colleagues at the Wharton School of the University of Pennsylvania and the London Business School. "Scholars are finding that morality and ethics are driven by one's ability to experience empathy and compassion, not some cost-benefit analysis. We know women are more emotional and experience these emotions more intensely than men. When you combine that with the fact that men are concerned about their masculinity being on the line, it becomes a toxic equation for ethics."

Mary Conway Dato-on, an Associate Professor at the Crummer Graduate School of Business, emphasizes that differences in male and female ethics has less to do with biological sex and more to do with elements of psychological gender. In a study conducted with Catherine McCabe and Rhea Ingram, the ability to identify unethical behavior depended largely on the existence of feminine "expressive" traits. (Expressive traits are those that are stereotypically feminine, include "affectionate," "compassionate" and "understanding," while masculine "instrumental traits" consist of things like "aggressive," "analytical" and "dominant.")

In Dato-on's view and based on subsequent research, the ideal ethical leader doesn't necessarily possess only feminine "expressive" traits, but a combination of the two types. "We found that androgynous people, regardless of whether they are male or female, those that have a combination of masculine and feminine traits tend to be both the most ethical and have the highest degree of entrepreneurial self-efficacy," she said. "So it has more to do with how you were socialized and how that socialization came to develop you as a person."

Another trend researchers cite with regard to the relative lack of unethical behavior coming from female leaders and politicians is based on the large body of research demonstrating that men engage in more risky behaviors than women. Or, put another way, women are simply more risk-averse than men, including when it comes to making decisions on behalf of a group.

It would be easy to interpret this phenomenon as an advantage that male leaders hold over their female counterparts and justification for the lack of women obtaining leadership positions. While men are more likely to engage in unethical behavior, they might also be perceived as more willing to do "everything it takes" to gain profits. A study of Directors at European banks, for example, found that the proportion of women on boards is higher for banks with lower risks and less leverage and surmised that this was due to employer biases.

But recent research has shown that gender diversity on corporate boards is linked to a wider range of occupational resources, higher productivity, and positive financial performance, leading some to conclude that having women in powerful positions not only leads to more ethical behavior and management for the company, but a happier bottom line.

And in today's corporate world, the two can often be one and the same. "You hear it a lot among experts and I would tend to agree," said Walsh, "If it had been Lehman Sisters instead of Lehman Brothers, the company might still be around."