Board Diversity Research Articles

Corporate board diversity, environmental compliance, and occupational health and safety disclosure for achieving sustainable development goals in an emerging economy

Corporate board diversity, environmental compliance, and occupational health and safety disclosure for achieving sustainable development goals in an emerging economy

Firms’ Board Diversity, Ownership Governance and Radical Innovation Quality

Firms’ Board Diversity, Ownership Governance and Radical Innovation Quality

Sustainable finance disclosure in ASEAN’s banking industry: Do board independence and diversity matter?

This paper aims at investigating the relation between board independence and diversity (gender diversity and nationality diversity) on sustainable finance disclosure (SFD) in ASEAN’s banking industry. We collected the SFD data from the sustainable finance report. The board independence variable is measured using the percentage of independent board members, while the board diversity is measured using Blau's index. This paper uses data with a total of 276 observations from 2017 to 2019 using two panel data regressions: fixed effect and random effect. The result of the study indicates that the SFD in ASEAN is at a low level because there are only 34 banks that implement SFD. SFD has a positive association with the board’s independence. While the gender diversity on the board is not significantly affecting the SFD. The board’s nationality diversity is negatively associated with SFD. The results of this study can be useful in evaluating the implementation of SFD for each banking organization in Southeast Asia. Furthermore, we expect the results of this research to assist ASEAN financial regulators and banking associations in optimizing SFD as a means of addressing the issue of climate change.

Board Diversity in Private vs. Public Firms

Board Diversity in Private vs. Public Firms

The Effect of Internationalization on Innovation in Emerging Economy Firms: Role of Board Diversity

The Effect of Internationalization on Innovation in Emerging Economy Firms: Role of Board Diversity

Transit Board Diversity and Pandemic Service Cuts in Vulnerable Communities

Despite its primary role in shaping policy and service characteristics, board governance is an understudied topic in the field of urban transit. Existing research on board management and representative bureaucracy theory suggests that the race and gender diversity of boards has a significant impact on organizational activity but that these relationships are highly dependent on the cultural context and industry analyzed. In this paper, we evaluate how the diversity of transit boards (with respect to race, gender, and disability) in the U.S.A. correlates with service changes authorized by these boards during the COVID-19 pandemic. Utilizing a database on board governance and general transit feed specification data for 36 agencies, we find a positive relationship between the presence of women on transit boards and vertically equitable service cuts, defined as increasing or maintaining transit service in more vulnerable neighborhoods. Overall, transit agencies with more female board members had more equitable service cuts, on average, during the COVID-19 pandemic.

Females in Corporate Board Diversity and Its Impact on Earnings Quality

Earnings quality is formed on corporate governance. The company's internal governance mechanism consists of the president director, the finance director, the board of directors, commissioners, and the audit committee. However, there is still a lack of studies exploring the relationship between female in-board diversity and earnings quality, especially in Indonesia. It is because Indonesia has a unique corporate governance system, even though Indonesia follows a corporate governance system on the European continent, namely the two-tier boards. This study aims to determine the influence of female president directors, female finance directors, female board of directors, female board of commissioners, and female audit committee on earnings quality. The sample of this study is manufacturing companies listed on the Indonesia Stock Exchange. Samples were selected using the purposive sampling method, and 70 companies were selected as research samples with a total data collection of 350 data from the research period of 2018-2022. Data analysis in this research uses multiple linear regression. The results of this study indicate that the presence of a female president director, a female finance director, and a female board of commissioner negatively affects earnings quality. On the other hand, the presence of the female board of directors has a positive effect on earnings quality. The female audit committee does not affect earnings quality. The author can conclude that the female gender still does not play an important role in the company's management to increase earnings quality because female’s behavior is more callous and not more assertive than male.

Board gender diversity and social disclosures: some empirical evidence from Indian companies

PurposeThe objective of this study is to assess if corporate social disclosures in a company are influenced by gender diversity at board level. We also investigate the number of women directors, who can collectively make an impact on social disclosures, by considering different numbers of women directors on the board.Design/methodology/approachWe have measured board gender diversity using the ratio of women at board and have also used two indices: the Blau-index and the Shannon-index. The social disclosure index is fetched from Bloomberg terminal. The research is quantitative and has been carried out using panel data models for estimating the linkage between board gender diversity and corporate social disclosures.FindingsOur results support the idea that women are more conscious of social concerns and that having a gender diverse board has a favourable impact on social disclosures. It also shows that when there is only one woman director on the board, she might not be able to affect social disclosures in a company; however, two or more women on board may significantly influence social disclosures.Practical implicationsThe study supports critical mass theory and has significant implications for academics, corporations and regulatory bodies. With the mandatory regulations on women directors, the study determines the significance of board gender diversity to improve policies for disseminating information of social nature.Originality/valueThe past studies have so far inspected the impact of gender diversity on financial performance, corporate social responsibility disclosures, dividend policies and corporate sustainability disclosures but have not specifically assessed the influence of gender diversity on social disclosures.

Board gender diversity in municipally owned corporations: A resource dependence perspective

The increasing use of municipally owned corporations (MOCs) to provide vital public services has drawn attention to the representation of women on MOC boards of directors. Resource dependency theory suggests that board composition is likely to be shaped by linkages to critical resources within an organization's environment. This paper presents an analysis of the organizational determinants of board gender diversity in 802 MOCs in England and Wales for the period 2009–2019. The findings suggest that public ownership, nonprofit legal form, board size and a human services focus are positively related to board gender diversity, but that inter-municipal ownership and a technical services focus are all negatively related to such diversity. The findings highlight the impact that organizational characteristics associated with critical resource dependencies can have on gender equality (GE) in corporatized public services. Points for practitioners Evidence on the determinants of gender board diversity in MOCs can help policy-makers to understand the role that organizational characteristics play in shaping GE within corporatized public services. This paper highlights that the ownership structure, board size and legal form of MOCs all affect the prevalence of women directors on MOC boards. It is also important to recognize how service area can influence GE on MOC boards.

The moderating role of board gender diversity on the association between audit committee attributes and integrated reporting quality

PurposeThe main objective of the research is to examine the influence of audit committee attributes on the integrated reporting quality (IRQ) and to investigate whether this association is moderated by board gender diversity in the manufacturing and non-manufacturing sectors. The study specifically investigates the association between audit committee independence, meetings frequency, financial expertise, audit committee size, and integrated reporting quality.Design/methodology/approachThe data collection was from the financial statements and corporate governance reports of 54 Egyptian firms listed on the stock market [EGX100] for the period of 2018–2022. The study used pooled effect modelling and performed data analysis using the STATA software.FindingsFor the manufacturing sector, the results showed a significant impact of audit committee independence and meetings frequency on IRQ, while audit committee size and financial expertise showed insignificant association with IRQ. Board gender diversity moderates the association between audit committee meetings only and IRQ. In contrast, audit committee financial expertise and meetings frequency significantly impact IRQ, while audit committee independence and size showed an insignificant impact on IRQ in the non-manufacturing sector. Also, board gender diversity moderates the association between audit committee and IRQ. The findings highlight the significance of AC attributes and provide guidance to firms to strengthen their audit committees in order to provide high quality of integrated reports to increase investor trust in the Egyptian business environment as it is now mandatory by the government.Originality/valueThis research offers unique perspectives on the association between variables in Egypt. This study is one of the first investigations on the impact of audit committee attributes and board diversity on integrated reporting quality within the context of Egyptian listed companies. Comprehending the ways in which audit committee attributes impact the integrated reporting quality in the manufacturing and non-manufacturing sectors can enable organizations to devise focused approaches that comply to the unique operational, regulatory, and investor demands in each sector.

Board gender diversity, investment efficiency and sustainable growth: evidence from Gulf Cooperation Council

Purpose This study aims to examine the impact of board gender diversity on sustainable growth by considering the mediating role of investment efficiency (INVEFF) in this relationship and the threshold effect between board gender diversity and INVEFF. This investigation focuses on the Gulf Cooperation Council (GCC) region, which is characterized by rapid socio-economic transformations and a recent emphasis on gender diversity. Design/methodology/approach Panel data regressions are applied to estimate the impact of board gender diversity on INVEFF using companies listed in the GCC in 2013–2022 as a sample. The estimations consider subsamples of underinvestment and overinvestment, as well as the pre- and post-COVID-19 pandemic periods. Findings The empirical results show a nonlinear impact of board gender diversity on INVEFF, a relationship that is more pronounced in the underinvestment subsample. The results indicate that INVEFF mediates the relationship between board gender diversity and corporate sustainable growth, which helps companies optimize their board composition to enhance their sustainable growth strategies. Research limitations/implications These findings could inform GCC regulators in mandating further increases in women’s presence on boards of directors to improve INVEFF. This study examined only GCC-listed companies. Future research should investigate other factors influencing INVEFF and conduct comparative studies across Middle Eastern and North African countries to consider different regulatory and economic contexts and to examine compliance with international standards. Social implications This study reveals the significant nonlinear impact of board gender diversity on INVEFF and the mediation of INVEFF in the relationship between board gender diversity and sustainable growth. These findings will help companies optimize their board of directors’ composition by increasing the presence of women on boards to improve their INVEFF and sustainable growth. This study aims to develop knowledge that will not only benefit companies regarding the potential impact of board gender diversity but also help international communities create better gender equality within companies. Originality/value To the best of the author’s knowledge, this study is the first to explore the relationship between board gender diversity and INVEFF in the emerging economies of the GCC region. It is also the first to examine the nonlinear relationship between board gender diversity and INVEFF and the mediating role of INVEFF in the relationship between board diversity and sustainable growth. This study contributes to the understanding of the financial impact of board gender diversity in improving corporate INVEFF and sustainable growth.

The Effect of Tax Planning on Firm Value: A Moderation Role of Board Diversity

The Effect of Tax Planning on Firm Value: A Moderation Role of Board Diversity

The moderating effect of risk management committee on board diversity and firm value

This paper attempts to deepen a better understanding of role risk management committee in mediate board diversity to firm value. Board diversity is proxied with gender of the board of directors, age of the board of directors, and setting behind board of director education. The firm value proxied with ratio Tobin's Q and the risk committee be measured with variable dummy. Type study This is study quantitative with population that is firm manufacturers registered with ISSI for the 2020-2022 period, total sample a total of 69 samples from 23 company data with method purposive sampling. Method data analysis using technique panel data regression with SPSS software version 25. Research results show age of the board of directors influential positive significant to firm value, meanwhile board of director gender and setting behind education no influential to firm value. Variable risk management committee no capable moderate influence gender of the board of directors, age of the board of directors, and setting behind education of the board of directors to firm value.

Interpersonal population diversity in the bank boardroom and corporate misconduct

PurposeThis research empirically establishes that the interpersonal population diversity of executive board members partly explains the differences in financial misconduct across US banks. It advances the hypothesis that heterogeneity in the composition of an interpersonal population and diverse traits of board members, originating from the prehistoric course of the exodus of Homo sapiens from East Africa tens of thousands of years ago, is an important factor explaining the effectiveness of executive board monitoring with respect to a bank engaging in financial misconduct. The underlying intuition is that population-fragmented societies, characterized by mistrust, preference heterogeneity and corruption, find it difficult to sustain collective integrity action.Design/methodology/approachEmploying a panel of US banks from 1998 to 2019 we find that adding directors from countries with different levels of interpersonal population diversity is positively associated with financial misconduct as measured by enforcement and class action litigation against banks by the main regulatory agencies. Furthermore, we document that the more population-diverse bank boards are more likely to commit misconduct, consistent with a mechanism of inter-generational transmission of cultural norms of mistrust and non-cooperation.FindingsWe find that adding directors from countries with different levels of interpersonal population diversity is positively associated with financial misconduct as measured by enforcement and class action litigation against banks by the main regulatory agencies. These results are robust to controlling for bank-specific variables, including other board characteristics, and to the use of instrumental variables.Practical implicationsThe findings suggest that reducing financial misconduct by banks likely requires reducing the interpersonal population diversity of banks’ executive boards.Originality/valueWe show how bank boards with different interpersonal population diversity impact the likelihood of engaging in misconduct provides evidence of the microeconomic effects of interpersonal population diversity. We show the negative results of diversity that they can have on the management of a firm given that populated diverse boards are more likely to lead to higher levels of misconduct. Our evidence reveals that banks having interpersonal population fragmented boards are more likely to commit misconduct given the cultural norms of mistrust and the lack of societal cohesiveness.

Unveiling the antecedents and the outcome of materiality disclosure: insights from sustainability reporting of Malaysian public listed companies

PurposeThe materiality principle is one of the top trends in sustainability reporting globally. Stakeholders have focused on the principle of materiality because of its vital importance in the context of sustainability. Materiality serves as a content-selection principle for determining the most significant sustainability matters to be included in sustainability reports. This has made reports more relevant for various stakeholders. Using the resource-based view and stakeholder theory, this paper aims to examine and uncover the antecedents and outcome of materiality disclosure in sustainability reporting.Design/methodology/approachTo measure the extent of materiality disclosure, a content analysis was performed on the corporate reports of the largest listed companies in Malaysia. The relationships among the variables under investigation were examined using the partial least squares structural equation modelling technique.FindingsWhile the results show that board activity, board independence and board size play significant roles as antecedents of materiality disclosure, this is not so with nationality diversity and gender diversity. In addition, the results have shown that the outcome of materiality disclosure is not significantly linked to corporate financial performance. The results show that normative stakeholder considerations are the primary motivating factor behind corporate sustainability reporting in Malaysia.Practical implicationsThese results are of great interest to regulators, stakeholders, investors and companies alike. Enhancing materiality disclosure in sustainability reports can help in the transition to sustainable development and the successful achievement of the United Nations sustainable development goals.Originality/valueTo the best of the authors’ knowledge, this is the first empirical study to examine the interplay between board diversity and materiality disclosure, along with their connections to corporate financial performance.

Regulating Diversity and Inclusiveness in Boards of Directors

Regulating Diversity and Inclusiveness in Boards of Directors

THE EFFECT OF BOARD DIVERSITY ON CORPORATE SOCIAL RESPONSIBILITY DISCLOSURE IN INDONESIAN MANUFACTURING COMPANIES

This study aims to examine the disclosure of corporate social responsibility in manufacturing companies in Indonesia as influenced by the diversity of the company's board of directors and board of commissioners. A total of 142 manufacturing companies listed on the IDX from 2017- 2021 became the population of this study. Purposive sampling was used in sample selection, resulting in a research sample of 42 companies. During the 5 (five) years of observation, 210 observations were obtained. The results showed that gender diversity characterized by the presence of women on the company's board had a negative effect on corporate social responsibility disclosure, age diversity characterized by the presence of a young board on the company's board had no effect on corporate social responsibility disclosure, and the diversity of the company's board education background with management and business education had a positive effect on corporate social responsibility disclosure.

The Nexus Between Board Diversity and Sustainability Reporting: The Moderating Role of Supervisory Effectiveness and Quality in a Two-Tier Board System

This study aimed to investigate how Board of Director (BOD) diversity affected sustainability reporting in Islamic banks in Indonesia. The effectiveness of three supervisory bodies, namely the Board of Commissioners (BOC), the Audit Committee (AC), and the Sharia Supervisory Board (SSB), was explored to determine their ability to enhance sustainability performance. The study was based on a sample of 13 Islamic banks listed with the Financial Services Authority between 2012 and 2021. Moderated Regression Analysis was applied to test the hypotheses. It was found that board diversity had a positive influence on sustainability reporting. The regression results for all three moderation variables showed positive and significant findings, indicating that the interactions between the BOC, the AC, the SSB, with the BOD played an effective role in enhancing sustainability disclosure. board ’diversity’s importance and supervisory boards’ effectiveness. This study fills a research gap on the relationship between corporate governance and sustainability disclosure, especially in developing countries that adhere to a dual board governance system, specifically Islamic banks that comply with Sharia governance. The research results underscore the need for a diverse board of directors and the effectiveness of the supervisory board as the party responsible for meeting stakeholder demands through its role in encouraging companies to be actively involved in sustainability performance.

Analyzing the Impact of Board Diversity on Financial Distress Risk: Empirical study on the Egyptian Listed Firms

Analyzing the Impact of Board Diversity on Financial Distress Risk: Empirical study on the Egyptian Listed Firms

Board Director Diversity and Corporate Innovation : A Library Research

Diversity among board members tends to foster a knowledge base for the company and encourage interaction between different knowledge and competencies. Diversity can also improve better performance such as creative and innovative ideas, as well as good problem solving. The purpose of this study is to understand the concept of board diversity on corporate innovation. The method used is an exploratory literature study of the results of previous research on board diversity and corporate innovation. The results from various sources show that the diversity of the board of directors in the company has a significant and insignificant effect on corporate innovation.