Female CEOs’ name gender-neutralization and audit fees: Evidence from China

Abstract

We focus on how inconsistency or conflict between actual biological sex and name gender-orientation affects CEO trustworthiness, and thus firm audit fees. This study of Chinese listed firms led by female CEOs finds that female CEOs’ name gender-neutralization significantly reduces audit fees, and the presence of female auditors mitigates the above negative relationship. Mechanism tests find that female CEOs’ name gender-neutralization reduces audit fees by adopting positive tone, enhancing TMT stability, and improving social image. Heterogeneity analysis from the perspectives of CEO and auditor traits demonstrate that when female CEOs were born before the 1970s, also serve as chairmen, and are non-family CEOs, as well as when auditors tenure is shortened, audit report time lag is decreased, and the audit team gender structure is singular, female CEOs’ name gender-neutralization reduces audit fees more significantly. We find no evidence that female CEOs with masculine or gender-neutral names perform better or worse than those with feminine names in any substantive way. Additionally, female CEOs’ name gender-neutralization does not have a consistent effect on positive and negative abnormal audit fees.