We examine the impact of CEO gender on firm‐level average labor cost. In a sample of U.S. public firms with voluntary labor cost disclosure, we find that firms with female CEOs have significantly lower average labor cost than firms with male CEOs. This effect is robust to the use of propensity score matching approach to alleviate the impact of possible selection bias and endogeneity concerns. The results are stronger in a subsample of firms where CEO turnover introduces CEO gender change. We hypothesize that female CEOs may be more risk averse and tend to pursue less risky corporate policies, leading to a lower equilibrium employee wage. Alternatively, female CEOs may offer higher non‐monetary employee benefits in lieu of monetary compensation. Our empirical results do not support the risk aversion hypothesis, whereas we find robust evidence that firms with female CEOs offer higher non‐monetary employee benefits than firms with male CEOs, especially in human capital‐intensive firms.

We use the firm's stock of trademarks and their ages to compute proxies for brand equity. We find that firms with more brand equity have lower equity and asset volatility and higher cash flows. Although suggestive of greater debt capacity, we find that firms with high brand equity use less debt. Further, brand equity has no influence on debt maturity. We provide evidence that the relation between brand equity and leverage is causal, using the enactment of the Federal Trademark Dilution Act in 1996, which exogenously increased the value of famous brands and significantly decreased the leverage ratio of firms with famous brands. This negative effect on leverage is weaker for firms with high business risk and low information asymmetry, and stronger for firms with collateralized trademarks. We argue that the negative effect of brand equity on leverage is more consistent with a pecking order mechanism than with a limited contractability mechanism.