Role of Gender-Based Emotional Intelligence in Corporate Financial Decision-Making

Abstract

PURPOSE: Business competition is getting more intense nowadays, and corporate survival is getting harder; consequently, corporate managers have to make financial decisions in complex and globalized scenarios. As a result, in order to compete in today's global economy, businesses are contemplating incorporating behavioural components of human psychology into their decision-making processes. Corporations are masters of quantitative analysis, but they rarely pay attention to behavioural elements of organizational success. Emotional intelligence is important in many parts of life; therefore, it is crucial to look at its dimensions when it comes to corporate financial decision-making. METHODS: A simple random sampling technique was used to collect data from 200 senior-level managers from the corporate sector located in the twin cities of Rawalpindi and Islamabad of Pakistan. SPSS version 22 was used to test the hypotheses. RESULTS: Results of the study show the gender-based variation in corporate financial decision-making detailing the higher impact of EI of males on CFD than their counterparts in the corporate sector organizations. The elements of self-awareness, empathy, motivation and self-regulation affect the financial decision-making of both the genders with varying degrees of influence, whereas social skills do not affect CFD of both genders. CONCLUSION: The study findings explicate that the influence of self-awareness and empathy constructs of EI on corporate financial decisions is stronger in female managers than their male counterparts. However, male managers exhibit a significantly stronger influence of motivation, social skills, and self-regulation dimensions on their financial decisions compared to female managers in a corporate setting. Overall, the impact of EI on CFD is slightly higher in male managers. These empirical outcomes imply that organizations should assess the employees not only for technical skills but also based on their emotional intelligence during the recruitment process.

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