Share Buybacks and Gender Diversity

Abstract

The authors find that board gender diversity increases the likelihood that firms announce a buyback but both short-term and long-term excess returns are significantly smaller when there are more females on the board.Introducing control variables that proxy for undervaluation, agency costs and other benefits from increasing leverage, eliminates the gender effect in short term but not in long-term returns. Hence firms with boards with low female representation are more involved in market timing.The results are consistent with past research that finds that male executives make superior returns than females from insider trading.