Women on Boards – The Influence of Corporate Elite

Abstract

Although we can observe noticeable progress in gender diversity on corporate boards, they are still far from gender balanced. Our paper builds on social identity theory to discuss the impact of corporate elite – multi-board men, who are sitting in multiple corporate boards – on board diversity. The empirical analysis, based on DAX 30 firms in the period of 2010-2015, shows that multi-board men resist women’s participation while the presence of multi-board and C-level women positively influences gender diversity on boards. We extend the main argument of social identity theory about homophily favorism by suggesting that multi-board men repel women on boards in order to protect their monopoly value generated from their majority status. Additionally, we find a significant effect of time pressure from the introduction of gender quota in Germany binding in 2016, which indicates that gender quota is an effective policy for board gender diversity.