Interactive Catalogue

Does Board Gender Diversity Really Improve Firm Performance? Evidence from Greek Listed Firms

Literature Item

Author Information:

Name: Stavros E. Arvanitis,Evangelos G. Varouchas & George M. Agiomirgianakis

Email: None

Website: https://sciprofiles.com/profile/2267049?utm_source=mdpi.com&utm_medium=website&utm_campaign=avatar_name

Abstract:

In recent decades, the contribution of board gender diversity to corporate performance has drawn the interest of researchers, politicians, and regulators. This paper examines whether board gender diversity affected the financial performance of 111 Greek listed firms from 2008 to 2020. It thus focusses the domain of economic power. The authors use the two-step system GMM estimator to address the endogeneity problem, which is the appropriate method used in governance literature. The main empirical finding supports the existence of a positive relation between board gender diversity and firm performance. This finding remains robust to three different proxies of gender diversity and under two alternative performance measures, i.e., return on assets and Tobin’s Q. the article finds that there is an inverted U-shaped relation between the proportion of female directors and firm performance (measured by Tobin’s Q). Moreover, the article finds that gender diversity could lead to maximization of corporate performance when female participation in the boardroom reaches 33%. Thus, the imposition of an ad-hoc 25% female representation in corporate boardrooms, dictated by the new Law 4706/2020 on corporate governance, could most probably be an underproductive policy. These findings have practical implications for Greek regulators and legislators and contribute to the governance literature for the case of companies that operate in a small open economy.

Keywords:

corporate governance, board gender diversity, firm performance, female participation

Dates:

July 13, 2022 - None

Source Specificity:

Initiative/Practice/Project/Programme/Case Studies

Website:

https://www.mdpi.com/1911-8074/15/7/306

Power Domains:

Economic

Methods Tools:

Gender Training, Awareness-raising

Country:

GR

City:

Athens

Implementation Scale:

national

Language:

English

Other Links:

https://doi.org/10.3390/jrfm15070306