scholarly journals Women Do the Job: The Reasons to Set Quota for Women on Boards

2018 ◽  
Vol 13 (12) ◽  
pp. 167
Author(s):  
Sara De Masi ◽  
Agnieszka Słomka-Gołębiowska ◽  
Andrea Paci
Keyword(s):  
Audit Committee ◽  
Empirical Support ◽  
Board Structure ◽  
Corporate Boards ◽  
Controlling Shareholder ◽  
Female Directors ◽  
Women On Boards ◽  
Board Monitoring ◽  
Women On Corporate Boards ◽  
Family Connection

In 2012 Italy introduced quota to increase the number of women on corporate boards. The aim of our research is to shed more lights on how women on boards, after the enforcement of quota law, improve the board functions and the board structure. Our study focuses on all Italian FTSE MIB companies from 2008 to 2015. Italy is a country where the percentage of female directors was very low before quota. Female directors, when present, were linked through a family connection to the controlling shareholder. Our research demonstrates that a higher percentage of women on boards, after the quota, leads to a higher board members attendance and more board meetings, thus a better board monitoring. We document that, after quota, one more women to the board results in increasing the board involvement in strategy and the independence of audit committee. Our findings provide empirical support on the effectiveness of female directors, suggesting important implications of the quota legislation on the “type” of women elected.

scholarly journals Women on boards and monitoring tasks: an empirical application of Kanter's theory

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sara De Masi ◽  
Agnieszka Słomka-Gołębiowska ◽  
Andrea Paci
Keyword(s):  
Design Methodology ◽  
Corporate Boards ◽  
Ongoing Debate ◽  
Content Type ◽  
Female Directors ◽  
Women On Boards ◽  
Board Monitoring ◽  
Women On Corporate Boards ◽  
The Relationship ◽  
Practical Implications

PurposeThis paper examines the relationship between women on boards and board monitoring tasks depending on group categories identified in the Kanter's theory.Design/methodology/approachUsing a sample of the largest listed companies in Spain, Italy and France during the period 2007–2017, this study tests the effect of women's presence based on the following board categories: (1) skewed boards with a percentage of women that is less than 20%; (2) tilted boards with a percentage of women that ranges from 20% to 33%; (3) tilted boards with a percentage of women that is more than 33%; and (4) balanced boards with an equal or quasi-equal gender distribution. The authors use the case of the gender board quota regulation in different European Union countries.FindingsThe results suggest that tilted boards engage in stronger firm monitoring and that the effect of women on board monitoring tasks is positive and statistically significant when the percentage of female directors reaches the threshold of 33%.Practical implicationsThe outcomes of this study help policymakers identify the minimum threshold that quota regulations should mandate in order for boards to be effective.Originality/valueThis paper moves forward the ongoing debate about the effect of women on corporate boards, shifting the focus from the ratio or presence of female directors to the size of the group they form within the board. To the best of authors’ knowledge, this is the first study to test Kanter's theory by investigating the relationship between women on boards and board monitoring.

Women on boards in India: a need or tokenism?

2018 ◽  
Vol 56 (8) ◽  
pp. 1769-1786 ◽  
Author(s):  
Varnita Srivastava ◽  
Niladri Das ◽  
Jamini Kanta Pattanayak
Keyword(s):  
Gender Diversity ◽  
Positive Association ◽  
Regulatory Reform ◽  
Corporate Boards ◽  
Content Type ◽  
Level Of Involvement ◽  
Female Directors ◽  
Women On Boards ◽  
The Right ◽  
The Impact

Purpose The purpose of this paper is to examine the significance of gender diversity on corporate boards in India in the light of recent regulatory reform introduced in the Companies’ Act, 2013 which mandated the presence of at least one woman on the corporate boards of all the listed firms. Design/methodology/approach Based on a panel of 300 firm-year observations for 15 years from 2001 to 2015, regression analysis has been conducted to analyze the relation between gender-related variables of corporate boards with firm-specific financial characteristic, cost of equity (COE) and return on assets (ROA) of firms listed in CNX Nifty, a major financial market index of India. Findings The analysis indicates that boards with gender diversity explain a slightly more than 5.5 percent change in a firm’s COE and have a much higher impact of 45 percent on a firm’s ROA. The presence of female directors on the boards and their independence have a negative association with the COE, whereas the level of involvement of female directors on different committees has a positive association with the ROA. Practical implications The findings may help theorists in defining the right mix of female on the corporate boards in an emerging economy. Also, by taking input from the findings, regulators and industry can formulate policies to foster gender diversity on corporate boards in India. Originality/value This study considers the recent regulatory norm introduced in India. This issue has still not been discussed and analyzed by researchers in India. It attempts to explain the impact a gender diverse board can make on a firm’s performance. It also makes valuable recommendations to improve the norms intended to more effectively foster gender diversity on corporate boards in India.

scholarly journals Gender-diverse boards get better performance on mergers and acquisitions

2020 ◽  
Vol 17 (4, Special Issue) ◽  
pp. 222-233 ◽  
Author(s):  
Nivo Ravaonorohanta
Keyword(s):  
Gender Diversity ◽  
Value Added ◽  
Corporate Boards ◽  
Representation Of Women ◽  
Female Directors ◽  
Gender Diverse ◽  
Women On Boards ◽  
And Gender ◽  
Board Gender Diversity ◽  
Executive Teams

In recent years, the composition of boards, particularly the appointment of female directors to the boardroom has attracted significant political and social debate. Despite several studies that have examined links between the representation of women on boards and the corporate performance, research on the board gender diversity in merger contexts is limited. We assess whether the presence of women on corporate boards affects merger and acquisition (M&A) performance. Using acquisition bids by public Canadian companies during 2012-2017, we find that an increasing number of female directors in acquiring companies is associated with an enhanced merger performance and a reduced bid premium. After controlling for gender diversity on executive teams, the value added by having women on boards is particularly noticeable when acquiring firms have few women in the executive teams, and where overconfidence is prevalent. Thus, there is a substitutive relation between gender diversity on the board and gender diversity on the executive team.

scholarly journals Enhancing Board Monitoring Tasks: The Effect of Minority-Elected Directors

2020 ◽  
Vol 15 (7) ◽  
pp. 85
Author(s):  
Sara De Masi ◽  
Andrea Zorzi
Keyword(s):  
Corporate Governance ◽  
Best Practice ◽  
Corporate Boards ◽  
Governance Mechanism ◽  
Minority Shareholders ◽  
Controlling Shareholder ◽  
Agency Relationship ◽  
Management Behaviour ◽  
Board Monitoring ◽  
Board Directors

In companies with a controlling shareholder the agency relationship between controlling shareholders and minority shareholders poses significant issue. Managers may pursue, rather than the interests of the company as a whole, the interest of the controlling shareholder. When there is a controlling shareholder, independent directors may not prove sufficient to monitor the management behaviour, given that they are ultimately appointed by the same controlling shareholder whose possible opportunistic behaviour they are meant to constrain. Therefore, minority shareholders may be given appointment rights to the board: directors elected by minority shareholders may work as a corporate governance mechanism that fosters the board’s willingness and ability to monitor managers’ behaviour, on the assumption that managers are appointed by the controlling shareholder. This paper examines empirically whether having a minority-elected director on corporate boards increases the ability of the board to monitor management behaviour. Using a sample of the largest listed Italian companies in years 2008-2017, we find that minority-elected directors have a positive and statistically significant effect on board monitoring tasks. We also document that this effect is higher when they are elected by institutional investors. Our results have important implications for policy makers and, more generally, corporate governance best practice in all contexts in which companies have a concentrated ownership structure.

Corporate Governance and Its Impact on Cost of Capital: Empirical Insights from Indian Listed Firms

GIS Business ◽  
2018 ◽  
Vol 13 (1) ◽  
pp. 27-37
Author(s):  
Showkat Busru Ahmad Busru
Keyword(s):  
Corporate Governance ◽  
Cost Of Capital ◽  
Empirical Support ◽  
Multiple Regression Model ◽  
Cost Of Debt ◽  
Board Structure ◽  
Governance Mechanism ◽  
Listed Firms ◽  
Board Characteristics ◽  
Board Monitoring

To perpetuate in stiff competition of corporate race role of corporate governance in creating value for shareholders has got amplified thus has become the subject of intense interest in corporate finance research. The main objective of our study is to examine the effect of corporate governance mechanism on cost of capital in listed Indian firms and to determine vital areas in corporate governance which directly or indirectly contribute towards reducing capital cost of sample Indian listed firms. From sample of 270 NSE listed Indian firms for period of nine years ranging from 2007–08 to 2015–16, using OLS multiple regression model. The empirical support to the understanding that corporate governance reduce firms cost of finance is consistent in Indian weak legal corporate setting also. However, Board characteristics has been found ineffective in causing overall cost of capital and debt and equity as well. Moreover, board characteristics have also failed to significantly affect the cost of debt. Governance effectiveness in reducing cost of capital through board structure, activities and disclosures are supporting the argument that potential investors in equity and debtholders favor monitoring mechanisms that are likely to limit managerial opportunism and consider board monitoring effectiveness as a source of greater assurance and confidence boosting mechanism among suppliers of finance and other stakeholders as well.

Why aren't More Women on Corporate Boards?: Views of Women Directors

1996 ◽  
Vol 79 (3) ◽  
pp. 840-842 ◽  
Author(s):  
Ronald J. Burke
Keyword(s):  
Boards Of Directors ◽  
Corporate Boards ◽  
Women Directors ◽  
Women On Boards ◽  
Women On Corporate Boards

This study examined views of 280 women directors as to why so few women sit on corporate boards. They served on Canadian corporate boards of directors and completed anonymous questionnaires. Women directors wanted more women on boards. Attitudes of male CEOs and board Chairmen were seen as the biggest obstacle.

Board independence and managerial authority

2018 ◽  
Vol 25 (3) ◽  
pp. 838-853 ◽  
Author(s):  
Mustafa Dah ◽  
Mohammad Jizi ◽  
Sadim Sbeity
Keyword(s):  
Positive Association ◽  
Managerial Compensation ◽  
Independent Directors ◽  
Board Independence ◽  
Board Structure ◽  
Corporate Boards ◽  
Content Type ◽  
Sarbanes Oxley ◽  
Managerial Authority ◽  
Board Monitoring

Purpose The imposition of the Sarbanes Oxley (SOX) Act and the NYSE/NASDAQ regulations boosted the proportion of independent directors serving on corporate boards. For certain firms, increasing the number of independent directors may impose costs that exceed the benefits. The purpose of this paper is to examine the implications of increased independence following SOX, relative to the pre-SOX board independence benchmark, on managerial authority and entrenchment within the firm. Design/methodology/approach Data are collected from COMPUSTAT, ExecuComp, and RiskMetrics. Data are divided into two periods, pre-SOX (1996-2001) and post-SOX (2002-2006). The focus is on the sub-group of firms who were not complying with the board independence requirement prior to SOX and became compliant afterwards. Various regressions are employed to assess the implications of increased independence following SOX on managerial authority and entrenchment. Findings The appreciation in board independence post-SOX significantly inflates both managerial compensation and the likelihood of CEO duality. Also, there is a positive association between board independence and managerial entrenchment during both the pre- and post-SOX periods. Imposed board composition requirements diminished board monitoring efficiency and boosted the CEO dominance and control over the firm. Originality/value This research adds to the extant literature investigating the implications of SOX on internal monitoring and governance. The results are based on an off-equilibrium phenomenon in which companies were obliged to alter their endogenously determined board structure. Thus, regulations to improve governance could backfire as the CEO might abuse them to extract private benefits.

scholarly journals Gender Diversity on U.S. Corporate Boards

ILR Review ◽  
2016 ◽  
Vol 70 (1) ◽  
pp. 160-189 ◽  
Author(s):  
Catherine H. Tinsley ◽  
James B. Wade ◽  
Brian G. M. Main ◽  
Charles A. O’Reilly
Keyword(s):  
Gender Diversity ◽  
The United States ◽  
Corporate Boards ◽  
Corporate Board ◽  
Publicly Traded ◽  
Representation Of Women ◽  
Women On Boards ◽  
Women On Corporate Boards ◽  
Gender Matching

Despite rhetoric supporting the advancement of women on corporate boards, meager evidence supports significant progress over the past decade in the United States. The authors examine archival board data (for more than 3,000 U.S. publicly traded firms) from 2002 to 2011 and find that a female is most likely to be appointed to a corporate board when a woman has just exited the position. A similar propensity occurs to reappoint a male when a man leaves, although the effect is smaller than for women. The authors argue that this “gender-matching heuristic” can impede progress in attaining gender diversity, regardless of intention, because it emphasizes the replacement of existing women rather than changing board composition. The authors replicate this effect in follow-up laboratory studies and show that “what works” to increase the representation of women on boards, irrespective of gender matching, is to increase the number of women in the candidate pool.

scholarly journals Women on corporate boards and the incidence of receiving a ‘strike’ on the remuneration report

2015 ◽  
Vol 12 (4) ◽  
pp. 261-272 ◽  
Author(s):  
Ammad Ahmed ◽  
Chew Ng ◽  
Deborah Delaney
Keyword(s):  
Lower Incidence ◽  
Negative Association ◽  
Matched Pair ◽  
Corporate Boards ◽  
Related Factors ◽  
Board Diversity ◽  
Female Directors ◽  
Women On Corporate Boards

This paper examines the effect of one form of board diversity on the incidence of receiving a ‘strike’ (i.e., receiving 25 percent or more ‘no’ votes) on the remuneration report by ASX companies in Australia. More specifically, the research hypothesises that there is a negative association between women presence on corporate boards and the likelihood of receiving a ‘strike’ on remuneration reports. Using the Financial Review Business Intelligence’s remuneration report voting database, this study constructs a matched-pair sample of 314 strike firms and 314 control firms from 2011 to 2013. After controlling for other ‘strike’ related factors, the results suggest a significant association between the presence of at least one woman on the board and a lower incidence of receiving a ‘strike’. This finding contributes to the research by showing that the presence of female directors is likely to enhance the monitoring function of the board and thus lower the likelihood of receiving a ‘strike’ on the remuneration report.

Boards of directors in Russian publicly traded companies: the gender aspect

2018 ◽  
pp. 142-155 ◽  
Author(s):  
T. A. Garanina ◽  
A. A. Muravyev
Keyword(s):  
Boards Of Directors ◽  
Company Performance ◽  
Corporate Boards ◽  
Publicly Traded ◽  
Publicly Traded Companies ◽  
Representation Of Women ◽  
Female Directors ◽  
Female Director ◽  
Gender Aspect ◽  
Longitudinal Dataset

This article studies the gender composition of corporate boards of Russian companies, including its relation to company performance. The analysis is based on a unique longitudinal dataset of virtually all Russian companies whose shares were traded on the stock market in 1998-2014. It shows a relatively small representation of women, just 12% of all the seats, while about 40% of the companies did not have any female director. At the same time, both the share of companies that appoint female directors and the share of female directors on boards show a clear upward trend. The econometric analysis suggests a positive link between the presence of female directors on boards and company performance, especially when firms appoint several, rather than one, female directors.

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