Corporate Board Gender Diversity Research Articles

Board gender diversity and corporate social responsibility

Based on a total of 1,590 listed non-financial firms on the Taiwan Stock Exchange and the Taipei Exchange (formerly the Over The Counter securities market) covering the period of 2007~2020, this study examines whether firm's performance on Corporate Social Responsibility (CSR) is affected by corporate board gender diversity. Based on the Upper Echelons Theory, the Agency Theory and the Resource Dependence Theory, increasing the number of female director to achieve higher level of gender diversity brings forth traits such as compassion, kindness, helpfulness, empathy, interpersonal sensitivity, a willingness to nurture, and a greater concern for others' well-being. These traits help firms form policies that prioritize stakeholders' welfare. Moreover, board gender diversity corresponds to a more diverse and broad background, understanding and experience of business operations, enabling firms to better understand where the key interest groups they face are and what they value. This allows firms to make more effective and better-performing decision in CSR. Through correlation analysis and multiple regression estimation, the principal outcome shows that greater degree of board gender diversity is associated with better CSR performance, confirming the hypothesis that a more gender diversified board enhances the efficiency of monitoring and advising function of board and then forming corporate strategies and implementations toward a better stakeholders’ management.

Gender diversity in corporate boards of companies listed on the Johannesburg Stock Exchange: a quantile regression approach

Purpose This paper aims to explore the effect of female’s presence in corporate governance structures to reduce agency conflicts, using a quantile regression approach. Design/methodology/approach The research investigates the relationship between company performance and boardroom gender diversity using quantile regression methods. The study uses annual data of 111 companies listed on the Johannesburg Stock Exchange from 2010 to 2020. Findings The study reveals that women on the board impact firm return on assets and enterprise value, varying across performance distribution. This contrasts fixed effect findings but aligns with two-stage least squares. However, quantile regression indicates that female executives and independent non-executive directors have notably negative impacts in high and low-performing companies, highlighting non-uniformity in the board gender diversity effect compared with previous assumptions. Practical implications The empirical findings suggest that companies with no women directors on the board are generally more likely to experience a decrease in performance and enterprise value relative to companies with women directors on the board. As recommended through the King Code of Corporate Governance, it is thus valuable to companies to ensure gender diversity on the board of directors. Originality/value The research confirms through rigorous statistical analyses that corporate governance policies, principles and guidelines should include gender diversity as a requirement for a board of directors.

When the going gets tough: Board gender diversity in the wake of a major crisis

Gender diversity on corporate boards continues to present a significant challenge, exacerbated by significant external disruptions such as financial crises or the recent COVID-19 pandemic. These exogenous shocks pressure organizations to reconcile diversity imperatives with more immediate concerns arising from the crises at hand. Employing elements from gender role and institutional theories, we argue that major exogenous shocks will negatively affect (i.e., reduce) gender diversity in corporate boards. Moreover, we propose that female CEOs and the strength of institutional mechanisms (i.e., quotas and corporate governance codes) will moderate (i.e., weaken) the negative effect of these shocks on board gender diversity. We examine these hypotheses in the context of the last global financial crisis (GFC), employing a panel of 10,181 unique firms across 21 countries between 2000 and 2015. We apply a two-way fixed effect difference-in-difference research design, complemented by an extensive battery of additional analyses to ensure robustness. Our results confirm a substantial decline in board gender diversity following the GFC. However, we do not find empirical support for female CEOs or institutional mechanisms in mitigating these diversity reductions. Following these findings, we propose several implications for research and policy.

Gender diversity of directors and financial performance: is there a business case?

Purpose Do women contribute to performance of companies on which they serve as board of directors? Many prior studies examine this issue, but no consensus is reached on the benefits of women taking on leadership positions. The present study considers this thorny issue from a slightly different perspective. Does the association between gender diversity and business performance vary across sectors and economic cycles?Design/methodology/approach The sample for this study was derived from the firms included in the S&P Australian Securities Exchange (ASX) 300 Index, and the study period of 2004–2016 allowed authors to consider the effects of different sectors as well as different economic cycles on the relationship between gender diversity of boards and business performance. The authors consider the Australian context, which is somewhat unique from the other Western countries, as quotas on boards of directors are not made mandatory and the corporate governance practices are principle-based rather than rule-based.Findings Employing panel data models, at the aggregate level, the authors find no evidence of board gender diversity impacting business performance. Consideration of sectoral differences and economic cycles in the empirical analyses yielded additional insights. In particular, gender diversity has a beneficial association with performance for businesses in the services and financial sectors after the changes to corporate governance guidelines relating to diversity in 2010. These economic benefits, however, are not evidenced in the resources sector.Research limitations/implications These findings offer support for critical mass and resource dependence theories.Practical implications The findings of this study have implications for inclusion and diversity policies of businesses and the society. Specifically, the findings offer support for gender diversity of corporate boards of directors.Originality/value This study highlights that women bring their unique skills and experiences to create economic value in sectors where they traditionally have more experience and opportunities.

Does religiosity have a dark side? Evidence from board gender diversity

PurposeThis research aims to investigate whether local religious norms influence corporate attitudes toward board gender diversity.Design/methodology/approachThe data are collected from American Religion Data Archive (ARDA) website and Boardex. The analysis used in this paper is ordinary least squares (OLS) regression and two-stage least squares (2SLS) models.FindingsThe authors find that firms headquartered in religious areas are negatively associated with corporate board gender diversity initiatives, proxied by the change in the total number of female directors, the share of directors that are newly hired females and the percentage of female directors on the board. The results remain robust when the authors employ alternative econometric specifications, including propensity score matching (PSM) and instrumental variable (IV) analysis. Furthermore, through quasi-experiments, the authors find that two exogenous shocks, the Vatican Leaks scandal and the Big Three board gender diversity campaign, attenuate the negative association between religiosity and diversity.Research limitations/implicationsThis study unveils an important but previously unidentified factor that restrains firms from exercising one of their socially responsible activities – board gender diversity and provides new insight into the emerging literature on the influence of local culture on corporate behaviors.Originality/valueThe lack of existing literature on factors that contribute to corporate board gender diversity presents opportunities for further study.

Board gender diversity, quotas and critical mass theory

PurposeThe corporate communications literature recently focused on corporate board gender diversity, specifically looking at two central aspects: gender quotas and equitable target percentages for women on corporate boards. This paper extends the debate by focusing on board gender diversity and critical mass theory.Design/methodology/approachThe paper gives a conceptual viewpoint on the issues raised in the literature on board gender diversity through a critical mass theory lens.FindingsFollowing the 2022 European Union (EU) directive, all EU member states will have to attain a 40% women representation on large corporate boards to achieve board gender diversity and what has been termed a “critical mass”. However, the literature indicates that gender diversity benefits may not be achieved if a critical mass is not composed of independent women directors who create a voice that produces a collective action. The authors highlight why a critical mass may not be achieved. The inconsistency in prior research linking corporate board gender diversity to economic performance may result from the critical mass of women directors not reflecting an independent collective action. However, as gender-diverse boards evolve, the authors argue that women will not just be seen as female directors but will be accepted on equal terms with their male counterparts and have an equal voice; gender will no longer be an issue and critical mass theory may then become irrelevant.Practical implicationsFrom a corporate communications perspective, this study will focus the minds of human resources (HR) professionals on the importance of the composition of women on corporate boards if the HR professionals wish to obtain the full potential benefits of board gender diversity. Theoretically, this study highlights the importance of critical mass and collective action when researching the economic benefits of corporate board gender diversity. Investment analysts may wish to look more closely at the structure of corporate boards and not just the numbers.Originality/valueThis paper gives a conceptual viewpoint on the critical mass theory and corporate board gender diversity, identifying that it is not just the numbers that are important but also the issue of minority independence and collective action, and this is, therefore, unique in this respect. Future research should identify if a critical mass (not just numbers) of women on corporate boards has been achieved. Only then that the linkage, based on critical mass theory, between board gender diversity and corporate performance/profitability can be made. Knowing whether board sizes are being increased to accommodate the added female directors would be also interesting, or will the new female directors replace existing male directors? However, the most important research question, once gender diversity has been achieved, could be: Is critical mass theory relevant with respect to board gender diversity?

The Effect of Corporate Board Gender Diversity on Compliance with EU Competition Law

The Effect of Corporate Board Gender Diversity on Compliance with EU Competition Law

Do Financial Expertise, Nationality and Independence of Women on Corporate Board Mitigate Earnings Management of Listed Firms on NXG.

This study evaluates the influence of financial expertise, nationality and independence of women on board of directors on earnings management of listed firms on NXG. Applying purposive sampling, a firm-year observation of 715 comprising 65 non-financial firms and secondary data from annual reports for 11years (2011-2021) were analysed using the holistic earnings management model. The outcome of the Generalised Least square (GLS) regression revealed that the measures of corporate board gender diversity attributes, CBGDAttr, (WOBFEXP, WOBNAT and WOBIND) jointly exert significant influence on earnings management (EARNMGT) of listed firms on NXG and upon this findings, it recommended that shareholder should strategize to increase gender diversity ratio to about 40% and that the nomination and governance subcommittee should take cognizance of the qualifications (financial expertise) and the independence of the female directors (INEDs) before appointment while considering appointing female foreigners with different nationalities having shares into the board to foster a creative environment where sharing of ideas and expertise across borders thrive; contributing to effective decision-making.

What is an equitable target percentage for women on corporate boards?

PurposeThe corporate communications literature recently raised the question, “Board gender diversity and women in leadership positions – are quotas the solution?” This paper extends the debate by asking, “What is an equitable target percentage for women on corporate boards?”Design/methodology/approachThe paper explores and gives a conceptualised viewpoint on the issues expressed in the literature concerning the meaning of board gender equality, focussing on what is regarded as an equitable number of women on corporate boards.FindingsThe arguments and questions raised in this paper highlight the difficulty in answering the research question. The question will only be answered when it no longer needs to be raised. In other words, when gender equality is no longer seen as an issue and men and women are treated equally, when qualifications, experience and ability are the key issues on board selection, not gender. Highlighting gender inequality issues by setting target figures may in itself deter some women from seeking board-level promotion. The target should not just be to place women in what is currently a masculinised board culture but to change this culture to reflect non-masculinity.Practical implicationsThis paper can guide practitioners in their policy-making decisions on corporate board gender diversity and refocus the minds of academics on such an important issue. It should also help change the hegemonic understanding of leadership and thus influence recruitment policy.Originality/valueThis is believed to be the first paper to give a conceptualised viewpoint on the issue of targets concerning the number of women on corporate boards and brings into perspective the wide variation highlighted in the literature. It adds to the current debate on board gender diversity and the lack of women on corporate boards by highlighting the questions regarding gender targets. A research opportunity lies in exploring this paper's conceptual issues and questions by soliciting the views of male and female management students and corporate directors.

Current Perspective on Corporate Board Gender Diversity: Evidence from the Czech Republic

Purpose: This article’s primary purpose is to present and analyze the current state of board gender diversity and elaborate on the relatively sparse literature in this field in the Czech Republic, a post-transition Eastern European economy. The described study sought to identify and comment on the theoretical views concerning previous research in other, mainly Western European countries, by highlighting new perspectives on board gender diversity. Design/methodology/approach: The study’s empirical analysis was based on 235 companies domiciled in the Czech Republic with 500 or more employees. We followed a selection protocol consisting of several filters in arriving at our final sample. We initially analyzed the data in relation to (a) the number of employees, (b) organization turnover, and (c) industrial classification. We calculated the mean (μ), standard deviation, (σ), and coefficient of variation (CV) of the data/variances, then tested our hypotheses through χ2, determining the significance through the p-value. Finally, we calculated the board diversity index (DI) for female/male board members. Findings: Our findings showed that the representation of women on corporate boards of Czech Republic companies is well below the European directive target figure of 40%. There is a greater representation of women on supervisory than on statutory boards. Moreover, the research revealed that female directors are more likely to serve on boards of companies in health care, social, wholesale, retail, and administration sectors compared to the construction, manufacturing, transportation, and storage sectors. Furthermore, company turnover also plays a part in board gender diversity. Finally, we highlighted many reasons why the Czech Republic is a fertile ground for the study of board gender diversity. Practical implications: We believe this article will be valuable to senior managers in industry and wider regulatory, corporate governance, and ethical environments, fostering diversity and equality on corporate boards. This article forms a sound foundation for future studies on board gender diversity in the Czech Republic and contributes to the ongoing discussion on any adoption of possible future quota. Originality/value: This research presents a rare insight into the current board gender diversity structure in the Czech Republic, especially because the country is relatively under-researched in the corporate governance and gender diversity literature. Thus, the research adds to the theoretical views concerning earlier research undertaken in other, mainly Western European countries, highlighting new perspectives on board gender diversity.

Looking into Corporate Boardrooms Through the Lens of Gender Diversity: A Bibliometric Review and META Analysis

The present study examines the literature on the corporate boardroom through the lens of gender diversity. The study identified 1413 studies from Scopus database to identify the corporate board gender diversity ranging from a period of 1998 to 2021 (November). The identified studies are reviewed by using VOS viewer software and R-Studio. The study also employed META analysis to further analyse the data and draw meaningful results. The study identifies the current themes in the literature of corporate boardroom diversity, find impediments to the growth in literature, find the most relevant paper over the years, most prolific authors, and most influential journal. The study also suggests the further scope of the study. We conclude by providing the five potential emerging research directions. The study identifies and discusses the main areas and current development in the field of corporate board diversity in terms of gender and suggests future research directions.

Do board subcommittees boost European firm value? The moderating role of gender diversity on boards

AbstractThe main objective of this study is to analyse the moderating effect of corporate board gender diversity on firm value for 1490 European listed companies between 2016 and 2018. The aim is to investigate whether companies that have different subcommittees (Audit, Corporate Governance, Nomination and Compensation), or that have financial expertise on the audit committee, see increases or decreases in firm value due to the moderating effect of gender diversity. The most striking evidence reveals that the effect of gender diversity on corporate boards, considering all countries in the European sample, could positively impact firm value by moderating the corporate governance and compensation committees. In contrast, when grouped by governance structure, only in the case of one‐tier boards is the moderating effect on the governance committee determinant. Likewise, this moderating effect on the compensation committee may increase firm value, but only in countries with two‐tier corporate boards. On the other hand, our results suggest that the moderating role of women directors on the audit committee with financial expertise and on the nomination committee, while not increasing firm value, could prevent its further decline by acting as a shield for the Nordic and two‐tier groups, respectively. Our findings have important implications for company managers, as these subcommittees could exert a positive influence on the decision‐making process, such as reducing information asymmetries and agency costs.

When the Going Gets Tough: In-group Bias and Board Gender Diversity in the Wake of Economic Shocks

Despite substantial benefits to organizations, increasing gender diversity in corporate boards remains an elusive problem due to persistent in-group biases that favor men. We engage in this conversation by probing theoretically and empirically the effects of economic shocks on board gender diversity (BGD) and the role of female leadership along with regulatory elements (i.e., gender quotas and corporate governance codes) in tackling this bias. We test our predictions using a large dataset of 6,582 firms and 45,610 observations in a quasi-experimental design that captures the heterogeneity of economic crisis in an international sample of 23 countries. Our results confirm a robust decline in BGD in the wake of an economic shock and a complex interplay between female leadership and the regulatory environment. Our findings contribute to leadership research on the bias faced by out-group minorities within organizational upper echelons and female leadership's role in dealing with pervasive organizational biases.

Women’s Presence on Corporate Boards: Addressing Director Selection, Participation, and Gender Bias

Gender diversity of corporate boards is gaining attention as a global issue, but women’s presence on boards remains low despite increased numbers of qualified women. Most research compares gender diversity of boards and firm performance or corporate social responsibility compliance and reporting, ethics compliance, or other decisions impacting firm risk and success. Despite positive outcomes associated with gender diverse boards, few women directors are appointed, and progress is slow. Quotas and incentives have been considered and implemented in several countries to develop board gender diversity, but without enforced quotas, minimal change is seen. When women are appointed, they are often not present in sufficient number to impact board gender diversity. A direct focus on gender bias in director selection and board member participation is needed to provide a deeper understanding of women’s presence on boards.

Impact of Artificial Intelligence on Corporate Board Diversity Policies and Regulations

With the use of artificial intelligence (AI) technologies in company activities, discussions on how to use AI in company management have emerged. Although AI is not legally recognised as a director in company law, there are examples of robot directors such as Vital, which have managed to get a seat in the corporate boardroom. Today, AI is on the verge of playing an important role in corporate governance. However, whether it has a seat on the board of directors or an important role in decision making is still a hot topic. Another critical discussion in the field of corporate governance in recent years is board diversity, which aims to improve the corporate decision-making process and create efficiency. This article attempts to anticipate the potential impact of AI on corporate board diversity policies and regulations. Therefore, this article seeks to examine the effects of the inevitable use of AI in the corporate decision-making process on corporate board gender diversity discussions and regulations under three possibilities: AI as a board member, AI as an enabler to assist a decision maker or AI being used to help decision making such as selecting board members.

Gender diversity on boards for organizational impression management: An empirical study of Japanese firms

AbstractThe literature on gender diversity on corporate boards is growing, yet firms' motivation for achieving such diversity remains underexplored. This study examines the potential objective behind appointing female directors that could be driven by organizational impression management based on the hypothesis that firms strategically propose to nominate female directors when they need to form a favorable impression to their stakeholders, especially in relation to executive compensation. This study analyzed annual shareholders meeting agendas for 3585 listed Japanese firms between 2011 and 2020 and found that firms placed female director appointments on the meeting agenda when they needed approval for the revision of executive compensation. This tendency was strengthened for firms with more outside directors. This study's approach and findings contribute to the literature on corporate board gender diversity by suggesting organizational impression management as a potential strategic motivation behind the appointment of female directors.

Board gender diversity and women in leadership positions – are quotas the solution?

PurposeThe question has been asked, “Where are the women?” explicitly looking at the public relations (PR) industry, but this is a broader issue reflected in many senior management roles, especially at the corporate board level. One of the solutions suggested is “quotas”. This paper explores the literature to identify the prominent arguments for and against representation regulations (quotas) concerning corporate board gender diversity and concisely presents the findings.Design/methodology/approachThe exploratory research path first focuses on a literature search using the keywords – “gender diversity”, “board structures” and “female traits” to identify the various issues concerning female members serving on corporate boards. This led to the investigation exploring if 'quotas' could play a role in increasing the number of female directors and, if so, what kind of impact this would have. When the authors discovered the paper by Place and Vardeman-Winter (2018), it was realised that a possible gap in the literature might have been identified. The focus then turned to the PR and corporate communications literature, where it was discovered that the issue of gender quotas was not explored. This paper brings together the germane literature from a wide range of disciplines. To obtain a broad perspective of the arguments, the authors conducted a review of this diverse field of literature through various databases and websites, including Scopus, Web of Science, ScienceDirect, Google Scholar, publishers' databases such as Emerald Insight, Taylor and Francis, Macmillan, Blackwell, Oxford University, etc.FindingsThere are solid arguments both for and against quotas. However, many opposing views appear to be less sound than the positive ones, which allowed the authors to concur in favour of quotas and the broader adoption of female directors. It is only by identifying problems that solutions can be found – the issues concerning corporate board gender quotas relate to the perception of the arguments for and against quotas; the reality is often different. While there is a strong “business case” and “stakeholder influence” for the inclusion of women on corporate boards, some governments have put further pressure (either voluntary or mandatory) on organisations by imposing a “quota” system. At the same time, other countries are undecided on what action, if any, to take.Practical implicationsThis paper can serve as guidance to countries that have not yet implemented quotas or those looking to move from a voluntary to mandatory quotas system. In addition to that, the paper should be valuable to academics, managers, regulators, legislators and policy-makers.Originality/valueTo the best of the authors knowledge, this is the first academic paper to present the critical arguments raised in the diverse literature on corporate board gender quotas succinctly and concisely and, therefore, adds value to the literature. It is also believed to be the first paper to address the issue of quotas in the PR and corporate communications literature.

Board Structure and Accounting Conservatism in Listed Non-Financial Firms in Nigeria

The study examines the impact of board structure on accounting conservatism in listed non-financial firms in Nigeria. The longitudinal research design was adopted and the study covered the period from 2010-2019. study period, there are 75 quoted non-financial firms in the Nigerian Exchange Group classification and these will constitute the sample. In this study, secondary data, by way of annual reports and accounts of the sampled companies in Nigeria and some relevant Nigerian Exchange Group fact books were used to collect data. The effect of corporate governance structure on accounting conservatism was analysed using panel regression. This study employed descriptive statistical methods and includes descriptive techniques such as the mean, standard deviation, range, frequency distribution. More importantly, the random effects (RE) and fixed effects (FE) regression as estimated. The findings of the study reveals that Board size (BDS) has a significant impact on accounting conservatism particularly for Market to book (MTB) and income statement based indicators of accounting conservatism. Also, Board independence (BDIND) has a significant impact on accounting conservatism and this is persistent across all three measures of accounting conservatism used in the study. Board gender diversity (BGD) has a significant impact on accounting conservatism particularly, for accrual based indicators. Hence the study recommends the need for corporate boards to reflect and represent all significant stakeholder interests so that board decisions will not be skewed unhealthily. Therefore, the study recommends for the presence of more independent directors in corporate boards. The study recommends the need for an increase in the level of gender diversity in corporate boards. The study recommends that there is need for shareholders to look closely in order to monitor the practices of management.

Gender Diversity in the Boardroom and Corporate Cash Holdings: The Moderating Effect of Investor Protection

This paper investigates whether gender diversity in the boardroom is associated with corporate cash holdings and whether investor protection moderates the effect of corporate board gender diversity on corporate cash holdings. Using 20,750 firm-year observations from 33 countries, our analyses show that firms with high levels of corporate board gender diversity exhibit low corporate cash holdings. Furthermore, firms in countries with high levels of investor protection have low corporate cash holdings. Moreover, the negative association between board gender diversity and corporate cash holdings is weaker in high-level investor protection countries than in low-level investor protection countries. Our results are robust to various specification tests, such as the endogeneity issue, weighted least-squares regression, the global economic crisis effect, alternative measures for corporate cash holdings, and various country-level institutional features. Taken together, the findings reveal that board gender diversity and investor protection have significant influences on corporate cash holdings. These findings have significant implications for politicians, governments, and regulators in devising policies relating to the United Nations Sustainable Development Goal (SDG Number 5) on achieving gender equality and women empowerment.

Contingent Effect of Board Gender Diversity on Performance in Emerging Markets: Evidence from the Egyptian Revolution

The 2011 Egyptian revolution was associated with significant political and social upheaval, followed by societal changes and attempts by policymakers to reduce the marginalisation of women and promote their inclusion in the economy. Drawing on this background, the authors compare the effect of board gender diversity before and after the revolution. Results indicate that gender diversity in corporate boards is coupled with improvements in firm performance in the immediate post revolution phase. This evidence provides insights into the contextual factors related to diversity and performance relationship and supporting arguments for regulatory changes to further encourage women’s representation on boards.