Ownership structure, board gender diversity and charitable donation

2018 ◽  
Vol 18 (4) ◽  
pp. 655-670 ◽  
Author(s):  
Ting-Ling Lin ◽  
Heng-Yih Liu ◽  
Chi-Jui Huang ◽  
Yu-Chiung Chen
Keyword(s):  
Ownership Structure ◽  
Critical Mass ◽  
Linear Regression Analysis ◽  
Gender Diversity ◽  
Charitable Donation ◽  
Content Type ◽  
Charitable Donations ◽  
Female Directors ◽  
Corporate Investors ◽  
Board Gender Diversity

Purpose This paper aims to examine the effect of ownership structure and board gender diversity on charitable donations for a group of listed electronics companies in Taiwan. Design/methodology/approach Using linear regression analysis, this paper analyses the ownership structure, board gender diversity and charitable donations of 380 Taiwanese electronics companies (2011-2013). Findings While domestic institutional investors, such as domestic mutual funds and corporate investors, take more of agency logic view, it negatively impacts on charitable donations. However, the empirical findings of this paper indicate that board gender diversity with the critical number of female directors was positively related to charitable donation. Thus, it is clear that female directors reaching critical numbers were taking more of a stakeholder view of institutional logic, emphasizing the balance of interests of internal and external stakeholders. Research limitations/implications This paper is limited to selected Taiwanese electronics companies over a two-year time frame, and charitable donations are the only proxy of corporate social responsibility (CSR) activity. The paper suggests that, as predicted by stakeholder theory and critical mass theory, companies with boards composed of at least three female directors make higher charitable donations. Practical implications This paper indicates that female directors on the board should have more voices on the board regarding the necessity and importance of CSR. Originality/value The paper contributes to existing literature by looking into the effects of ownership structure and board gender diversity on charitable donations.

Female directors and agency costs: evidence from Chinese listed firms

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Qurat Ul Ain ◽  
Xianghui Yuan ◽  
Hafiz Mustansar Javaid ◽  
Muhammad Usman ◽  
Muhammad Haris
Keyword(s):  
Agency Costs ◽  
Conflicts Of Interest ◽  
Critical Mass ◽  
Gender Diversity ◽  
Ordinary Least Squares ◽  
Content Type ◽  
Listed Firms ◽  
Female Directors ◽  
Wide Range ◽  
Board Gender Diversity

PurposeThe purpose of this research is to examine whether board gender diversity reduces the agency costs of firms in the context of Chinese listed firms.Design/methodology/approachThis paper uses a large sample of 23,340 firm-year observations of Chinese listed companies during 2004–2017. The authors use ordinary least squares regressions as the primary methodology with a wide range of methods to control for endogeneity and to check robustness, including the fixed-effect method, instrumental variable approach, lagged gender diversity measures, propensity score matching, Blau index, Shannon index and industry-adjusted measures of agency costs.FindingsThe evidence reveals that the participation of female directors in corporate board reduces agency costs, which correlates with conflicts of interest. Moreover, gender-diverse boards are more effective in state-owned enterprises (SOEs), in which agency issues are more severe. Female directors also provide better monitoring roles in more-developed areas. Finally, corporate boards that have a critical mass of female directors have a greater tendency to reduce agency costs as compared to their token participation. Overall, all findings support the validity of agency theory.Practical implicationsThis study shows the economic benefit of female directors in the boardroom by reducing agency costs and by improving firms' governance structure. Regarding the government, which is gradually introducing board gender diversity policies, this study provides valuable pragmatic information for Chinese regulators on this issue.Originality/valueThis study extends the literature by providing evidence that gender diversity in boardroom matters for shareholders' wealth maximization. It provides novel evidence that a critical mass of female directors is more effective in reducing agency costs compared to a single female on the board, and that the effect of gender diversity varies in relation to ownership structure and region.

scholarly journals Board gender diversity and firm performance: evidence from the Russian agri-food industry

2020 ◽  
Vol 23 (1) ◽  
pp. 35-53 ◽  
Author(s):  
Alisher Tleubayev ◽  
Ihtiyor Bobojonov ◽  
Taras Gagalyuk ◽  
Thomas Glauben
Keyword(s):  
Firm Performance ◽  
Large Scale ◽  
Positive Impact ◽  
Critical Mass ◽  
Gender Diversity ◽  
Policy Makers ◽  
Global Food Security ◽  
Female Directors ◽  
Corporate Executives ◽  
Board Gender Diversity

This study provides pioneering empirical evidence on board gender diversity and firm performance relationship for the case of large-scale agri-food companies in Russia. While Russia plays an important role in the global food security, its domestic agri-food production is heavily dependent on large scale producers. Our findings suggest a strong positive link between the percentage of female directors in boardrooms and firm performance. Moreover, in line with critical mass theory, boards with three or more female directors have greater impact on firm performance compared to boards with two or less female directors. Further analysis shows that the presence of female directors in the company has a positive impact on firm performance, mainly due to their executive, rather than monitoring effects. The paper shed light on gender diversity of Russian corporate boardrooms and provides empirical recommendations for policy makers as well as corporate executives in Russia.

scholarly journals Can board gender diversity promote corporate social performance?

2017 ◽  
Vol 17 (5) ◽  
pp. 789-802 ◽  
Author(s):  
Khine Kyaw ◽  
Mojisola Olugbode ◽  
Barbara Petracci
Keyword(s):  
Emerging Markets ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Critical Mass ◽  
Gender Diversity ◽  
Corporate Boards ◽  
Content Type ◽  
Clear Cut ◽  
Board Gender Diversity ◽  
Corporate Social

Purpose This paper examines if gender diversity on corporate boards promotes corporate social performance (CSP) across industries and across countries. Design/methodology/approach Fixed-effect panel models are estimated using Europe-wide data from 2002 through 2013. Instrumental variable estimation and propensity score matching are also used to control for potential endogeneity. Findings Board gender diversity (BGD) improves environmental and social performance and consequently the CSP. Although the positive effect of gender diversity is prevalent across industries, the effect is more pronounced for firms in emerging markets. Practical implications The findings suggest that gender law that fosters gender diversity can promote CSP in firms, and the benefit can be enjoyed with just an introduction of one female director to the board. Promotion of gender diversity in Europe is most beneficial in emerging markets. Originality/value The results provide new insights to the literature, as we find that a critical mass of female directors on boards is not required to promote CSP. The research also highlights that BGD enhances CSP irrespective of the industry, and the effect on CSP is more pronounced in emerging markets where regulations regarding CSR are not so clear-cut.

scholarly journals Does gender diversity on the board reduce agency cost? Evidence from Pakistan

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ali Amin ◽  
Ramiz Ur Rehman ◽  
Rizwan Ali ◽  
Collins G. Ntim
Keyword(s):  
Gender Diversity ◽  
Business Environment ◽  
Agency Cost ◽  
Agency Conflicts ◽  
Content Type ◽  
Listed Firms ◽  
Financial Firms ◽  
Female Directors ◽  
Board Gender Diversity ◽  
The Impact

Purpose This study aims to examine the effects of board gender diversity on agency costs in non-financial firms listed on the Pakistan Stock Exchange (PSX). Design/methodology/approach Multiple regression analysis is used to determine the impact of board gender diversity on agency cost. The research used panel data consisting of 2,062 firm-year observations of 226 non-financial firms listed on the PSX from 2008 to 2019 to test the proposed hypothesis. In addition, the Blau and the Shannon indices were used to checking for robustness. Findings The results indicate that female presence on the board significantly reduces the agency cost and, hence, mitigates the principal-agent conflict. Moreover, consistent with the critical mass theory, it was found that boards with three or more female directors have a stronger impact on reducing the agency cost, as compared to two or fewer female directors on the board. Research limitations/implications The sample was restricted to non-financial firms listed on the PSX only; therefore, the results reflect the attributes of Pakistan’s business environment. A similar analysis in the context of other countries may generate different results. Practical implications The findings imply that female directors play an important role in reducing agency conflicts between shareholders and managers by enhancing monitoring through effective governance mechanisms. The policymakers, therefore, should focus on female career development and encourage professional training programmes to generate a fair, competitive environment for senior female management. Originality/value This study attempts to fill the literature gap in that no similar study covers the non-financial firms’ listed firms in Pakistan. The paper supports the reforms made by the code of corporate governance by making the placement of female directors mandatory on Pakistani corporate boards. Overall, support is provided for the view that regulators should favour gender quotas regarding the composition of the board management team of listed firms to reduce agency conflicts and gain shareholder confidence.

Female directors and risk-taking behavior of Indian firms

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Shreya Biswas
Keyword(s):  
Risk Taking ◽  
Fixed Effects ◽  
Critical Mass ◽  
Gender Diversity ◽  
Dynamic Panel Data ◽  
Fixed Effects Model ◽  
Firm Level ◽  
Content Type ◽  
Female Directors ◽  
Risk Taking Behavior

PurposeThis study examines whether female directorship on board is related to firm's risk-taking behavior in India.Design/methodology/approachThe study considers the top 500 listed companies in India during the period 2013 to 2018 for the analysis. The paper employs fixed effects as well as a dynamic panel data model to address the bias in the fixed effects model when the lagged risk outcome is included as an explanatory variable.FindingsThe study finds that the presence of female directors on board is unrelated to the firm's risk-outcomes and the risk-adjusted return earned by the shareholders. The results are in line with the tokenism theory of board diversity. Having a higher share of female independent directors is also unrelated to the risk-taking behavior of firms. The findings are in contrast to the critical mass theory and the agency theory of gender diversity. The study does not rule out the possibility of female directors' risk-preferences being similar to those of male directors.Practical implicationsThe findings suggest that regulations related to having independent female directors may not add value for the shareholders in the short run. The business case for such stringent regulations in India on the gender diversity of boards remains unclear.Originality/valueThis is the first study to analyze the relationship between gender diversity of boards and firm-level risk in India. Most of the studies have focused on gender diversity and firm performance in India. However, modern portfolio theory suggests that both risk and return are important as shareholders care about risk-adjusted returns.

Gender diversity in compensation committees and CEO pay: evidence from China

2018 ◽  
Vol 56 (5) ◽  
pp. 1065-1087 ◽  
Author(s):  
Muhammad Usman ◽  
Junrui Zhang ◽  
Fangjun Wang ◽  
Junqin Sun ◽  
Muhammad Abdul Majid Makki
Keyword(s):  
Firm Performance ◽  
Critical Mass ◽  
Gender Diversity ◽  
Least Square ◽  
Content Type ◽  
Female Directors ◽  
Gender Diverse ◽  
Ceo Pay ◽  
Female Director ◽  
Compensation Committees

Purpose The purpose of this paper is to address whether gender diversity on compensation committees ensures objective determination of CEOs’ compensation. Design/methodology/approach The authors use a sample of companies listed in China from 2006 to 2015. The authors use pooled ordinary least square regression as the baseline methodology, and two-stage least square regression and propensity score matching to control for endogeneity. Findings The authors find evidence that gender-diverse compensation committees limit CEOs’ total cash compensation and strengthen the link between CEO pay and firm performance, but only independent female directors have a significant impact, indicating that the monitoring effect outweighs the executive effect. Moreover, compensation committees with a critical mass of female directors have more impact on CEOs’ total pay and the link between CEO pay and firm performance than do committees with a single female director. Finally, gender-diverse compensation committees are more effective in setting CEOs’ compensation in state-controlled firms, where agency issues are more severe. Practical implications Female directors can improve firm-level governance by monitoring management actions, such as setting CEOs’ compensation. The study contributes to the debate on gender diversity in the boardroom, finding a positive economic effect. The study sheds light on China’s diversity practices at the director level and provides empirical guidance to China’s regulatory bodies. Originality/value The authors extend earlier studies by providing the first empirical evidence that gender-diverse compensation committees strengthen the link between CEO pay and firm performance; that independent female directors are more effective in the monitoring role than executive female directors; that compensation committees with a critical mass of female directors are more effective in setting CEOs’ pay than are committees with a single female director; and that the influence of gender-diverse compensation committees on CEOs’ pay varies by type of ownership.

scholarly journals The association between board gender diversity and financial reporting quality, corporate performance and corporate social responsibility disclosure

2018 ◽  
Vol 31 (1) ◽  
pp. 177-194 ◽  
Author(s):  
María Consuelo Pucheta-Martínez ◽  
Inmaculada Bel-Oms ◽  
Gustau Olcina-Sempere
Keyword(s):  
Firm Performance ◽  
Financial Reporting ◽  
Gender Diversity ◽  
Reporting Quality ◽  
Content Type ◽  
Csr Reporting ◽  
Female Directors ◽  
Csr Disclosure ◽  
Board Gender Diversity ◽  
Corporate Social

Purpose Companies, politicians, the mass media, legislators, scholars and society in general have shown a growing interest in how board gender diversity affects a firm’s decisions. This concept has been developed because some nations have introduced voluntary policies to regulate and increase the proportion of female directors on corporate boards. Thus, the purpose of this paper is to review previous research based on board gender diversity as a corporate governance mechanism and its effect on some firms’ business decisions: financial reporting quality (FRQ), firm performance and corporate social responsibility (CSR) reporting. Design/methodology/approach The authors focus on the agency and stakeholder theory to examine the link between female directors on boards and FRQ, CSR disclosure and firm performance. Findings This review provides researchers a structure that can identify the benefits and disadvantages of including female directors on boards regarding three particular corporate outcomes (FRQ, firm performance and CSR reporting). Originality/value This study provides a review of past literature on firm performance, CSR disclosure and FRQ from 1975 to 2017, and it contributes to past research by giving a broad overview of the main results of the association between female board directors and corporate decisions. The findings have implications for governments, academics and company managers.

Board gender diversity and firms' internationalization speed: the role of female directors' characteristics

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ge Ren ◽  
Ping Zeng
Keyword(s):  
Gender Diversity ◽  
Schema Theory ◽  
Manufacturing Firms ◽  
Economic Consequences ◽  
Content Type ◽  
Upper Echelons Theory ◽  
Female Directors ◽  
Internationalization Speed ◽  
Board Gender Diversity ◽  
The Impact

PurposeDrawing on the gender self-schema theory, upper echelons theory and the literature on international business, this study aims to examine the impact of board gender diversity on firms' internationalization speed.Design/methodology/approachIn this study, secondary data of 886 listed Chinese manufacturing firms from 2009 to 2018 are studied using the ordinary least squares regression model as the baseline method, an instrumental variable method is adopted for endogeneity control and both fixed and random effect models are adopted for the robustness test.FindingsBoard gender diversity reduces firms' internationalization speed, and the negative effect between board gender diversity and internationalization speed is stronger when the average age of female directors is older and weaker when female directors have international experience or financial background.Practical implicationsFirst, Chinese firms need to increase or decrease board gender diversity to match the board to firms' internationalization strategy. Increasing board gender diversity may be a more appropriate choice for firms that are expanding rapidly internationally, and vice versa. Second, when introducing female directors to international firms, it is essential to address other characteristics of these directors beyond their gender.Originality/valueFirst, the authors contribute to the literature on board gender diversity using Chinese manufacturing firms as our research sample, which provides new insights into the economic consequences of increasing the number of female directors. Second, this research contributes to the literature on firms' internationalization speed. Third, the authors capture in more detail the economic consequences of increasing board gender diversity in the context of China.

The impact of board gender diversity and foreign institutional investors on firm innovation: evidence from China

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Qurat Ul Ain ◽  
Xianghui Yuan ◽  
Hafiz Mustansar Javaid
Keyword(s):  
Critical Mass ◽  
Gender Diversity ◽  
Manufacturing Firms ◽  
Firm Innovation ◽  
Content Type ◽  
Foreign Institutional Investors ◽  
Patent Applications ◽  
Board Gender Diversity ◽  
Mass Participation ◽  
The Impact

PurposeThis study investigates the impact of board gender diversity and foreign ownership on innovation in Chinese firms.Design/methodology/approachThe authors use data for Chinese manufacturing firms listed on the Shanghai and Shenzhen stock exchanges, for a sample over the period 2008–2017. Ordinary least square (OLS) is used as the baseline methodology, with cluster OLS, two-stage Heckman test, Blau index and Shannon index used to address endogeneity issues.FindingsThe results show that gender diversity on the board has a positive effect on corporate innovation as measured by the total number of patent applications, invention patent applications, utility model patent applications and design patent applications. Our findings also provide support for the critical mass participation of female directors on the board being associated with more innovation. They also reveal that innovation output does not vary across state-owned enterprises (SOEs) and non-SOEs. These outcomes reveal that SOEs' advantages, such as easy access to funding and more support of government, are likely offset by their disadvantages, such as different goals and having more agency issues. Because of intense political power and networks in Chinese firms, qualified foreign institutional investors (QFIIs) are less motivated to enhance innovation activities.Practical implicationsThis study highlights the role of board gender diversity in enhancing innovation among Chinese manufacturing firms. Our findings provide support for regulatory bodies' role regarding women's participation on the board.Originality/valueThis research adds to literature by addressing the largely ignored questions of whether providing a gender-diverse board enhances innovation, whether critical mass participation has a greater effect on improving firm innovation and whether the influence of women directors varies with ownership structure.

Board gender diversity and the timing of CEO stock option awards

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Moncef Guizani ◽  
Ahdi Noomen Ajmi
Keyword(s):  
Stock Price ◽  
Gender Diversity ◽  
Chief Executive ◽  
Stock Option ◽  
Content Type ◽  
Instrumental Variable Analysis ◽  
Compensation Committee ◽  
Female Directors ◽  
Research Findings ◽  
Board Gender Diversity

Purpose This study aims to explore the role of board gender diversity in mitigating chief executive officer (CEO) luck. CEOs are “lucky” when they receive stock option grants on days when the stock price is the lowest in the month of the grant, implying opportunistic timing. Design/methodology/approach This study uses a logistic regression analysis and an instrumental-variable analysis. The sample consists of 3,249 firm-year observations from 2010 through 2015. Findings The results show that female directors significantly deter the opportunistic timing of option grants. This study finds that gender diversity – as measured by the percentage of women on the board, the percentage of female independent directors and the percentage of female directors on the compensation committee are likely to reduce the odds that CEOs receive opportunistically timed lucky grants. The results are consistent with those in prior research that documents the benefits of board gender diversity. Practical implications The research findings are beneficial to policymakers and regulators, as it allows them to assess the importance of diversity on boards in the monitoring of the managers, particularly as it pertains to the design of CEO compensation packages. Furthermore, these findings have implications for Ibero-American countries as they shed light on the importance to undertake measures and reforms to promote board effectiveness by the introduction of gender diversity. Originality/value While prior research has examined the effect of board gender diversity on firm performance, the study is the first to investigate the effect of female directors on the opportunistic timing of option grants, using a rigorous empirical framework that explicitly accounts for endogeneity.

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