COVID-19 and Gender Differences: How did the Compensation Scheme for Businesses affect gender differences in Norway?

Abstract

In this thesis, we study the Compensation Scheme for Businesses that applied in Norway during the COVID-19 pandemic. Specifically, we investigate whether there is a difference in received grant amount between businesses with female CEOs and businesses with male CEOs, and how this potential difference affect gender equality. We study private limited companies that received compensation through the scheme for January and February 2021. To answer the research question we use descriptive statistics, the OLS method and perform a Blinder-Oaxaca decomposition. We find that 82.09 percent of the money paid out through the scheme went to businesses with male CEOs, which is not surprising as 83.24 percent of all CEOs in Norwegian private limited companies are men. However, the businesses with female CEOs have on average received 41.20 percent lower grant amounts than the businesses with male CEOs. When controlling for firm size, industry, region and the gender of the board chairperson, we find no significant difference in mean grant amount between businesses with female CEOs and businesses male CEOs. However, the dummy for female chairperson is significant, which indicates that the gender of people in leadership positions is still correlated with grant amount. The regressions show that the majority of the gender difference can be explained by male CEOs on average running larger businesses than female CEOs. According to the Blinder-Oaxaca decomposition, the average grant amount for businesses with female CEOs is higher in industries with a larger share of female CEOs. This indicates that industries with a larger share of female CEOs were affected particularly hard by the pandemic. Our results show that gender equality is still lacking in the Norwegian corporate sector and that the number of female CEOs is too low given the political goal of gender equality. Based on our findings, we believe that the scheme have contributed to increased gender differences and that this should be investigated further in future research.