This study aims to investigate the impact of the presence of women directors on firm’s risk-taking behavior in industries where innovation is pivotal and how this impact varies across ownership structure.
A sample of 71 listed technology firms on the National Stock Exchange of India for the period of 2008 to 2013 was used. Generalized method of moment estimation technique was used for data analysis.
Results reveal a positive impact of the presence of women directors on technology firms’ risk-taking behavior measured in terms of R&D spending, which is in contrast to the traditional notion that women are risk-averse. Further, results also reveal that family ownership negatively affects the impact of the presence of women directors on risk taking in technology firms.
The findings of the study suggest that females are risk takers in the context of R&D-intensive technology firms, thus providing new insight for policymakers to formulate more effective board gender diversity policies.
Based on the integration of agency and behavioral theories, it is suggested that female executives may be risk-averse or risk-takers depending on contextual factors such as innovation and ownership, which drive the impact of the presence of women directors on firms’ risk-taking behavior.
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