Does women's board representation affect non‐managerial gender inequality?

Abstract

AbstractResearch examining gender and corporate boards has explored how women's representation impacts firm strategy and policy, particularly around corporate social responsibility (CSR) issues related to communities and other relevant stakeholders, the environment, and diversity and equity initiatives. However, fewer studies have examined how women's representation on boards affects gender inequality in firms. The studies that have been conducted generally focus on gender board diversity and the appointment of women executives. Yet, prior research has not sufficiently examined women's board representation and gender equality below executive level. Does women's representation have broader effects on gender equity beyond top leadership? And if so, is there a critical mass effect? In this article, we examine the relationship between women's board representation and non‐managerial gender segregation. Gender segregation is an ideal measure of gender equality given that it captures the evenness of the distribution of women and men across jobs within workplaces and its well‐known relationship to gender disparities in earnings and other job rewards. Drawing on Australian organization data (2014–2019) we find that the contemporaneous relationship between women's board representation and gender segregation is nonsignificant, but becomes significant and increases in magnitude with 1, 2, and 3‐year lags. Our critical mass analysis suggests that having one woman on a board may not be enough to promote change but rather two or more women directors, or holding 20% or more board seats, appears to be more effective in reducing gender segregation. These findings demonstrate that the appointment of more women to corporate boards has broader effects on workplace gender equity beyond top leadership teams.