Women directors’ effect on firm value and performance: the case of REITs

Abstract

PurposeThe purpose of this paper is to assess the effect of women directors on US Real Estate Investment Trusts (REITs) value and performance.Design/methodology/approachArchival financial and board of director data for the 1999–2019 period are collected and analyzed using panel data regression analysis.FindingsThe main findings indicate that women directors’ presence renders a modest positive effect on REIT performance but only when they reach critical mass on REIT boards; and that women directors have no effect at all on REIT value. Additional findings indicate that women directors are more common on REIT boards after the enactment of the Sarbanes–Oxley Act but less common on boards in which the REIT founder is the chief executive officer.Originality/valueTo the best of the author’s knowledge, this is the first research on the effect of a gender diverse board on REIT value. It is also the first paper documenting a positive relationship between board gender diversity and REIT performance. This paper fills a research gap, as it is one of the few papers focused on gender diversity within the REITs board composition literature.