Gender differences in performance and development potential and resulting impacts on promotions

Performance appraisals (PA) are widely used to assess employees’ performance and development potential, influencing decisions about work allocation, compensation, promotion, and employee termination. Because PAs are so influential, any differences in evaluations between demographic groups – such as between men and women - are incredibly important, given their potential to affect downstream employee outcomes. However, empirical evidence on the direction, magnitude, and moderating factors of gender differences in PAs has been inconsistent. Using a large dataset (N = 20,199 employees) from a multinational wholesale company, we replicated and extended findings on gender differences in PA ratings, examining potential moderating variables and downstream effects on promotions as a key future employment. Our findings revealed statistically significant but small to very small gender differences in evaluations of performance and development potential, with male employees receiving slightly higher ratings than female employees. These differences were moderated by the department gender composition and partially by manager gender. Despite these differences, PA ratings of performance and development potential were similarly related to promotions for both male and female employees.