TY  - JOUR
AB  - Purpose This paper aims to examine the relationship between board diversity and total directors’ remuneration in Malaysia. The authors have operationalised two variables to represent board diversity: the proportion of women directors on the board, to present gender diversity and the proportion of Bumiputras directors, to represent ethnic diversity.Design/methodology/approach This study has used a panel least squares to test the relationship between board diversity and total directors’ remuneration.Findings Based on a 1,094 firm-year sample from 2007 to 2009, the authors found a positive and significant relationship between gender-diverse boards and remuneration, but a negative and significant relationship between ethnically diverse boards and remuneration. The interaction between gender and ethnically diverse boards results in a weaker negative relationship between ethnically diverse boards and remuneration with an increased presence of women directors. Finally, the authors found a positive and significant impact on remuneration when there are at least three women and three Bumiputras directors. The findings are robust after controlling for corporate governance variables, institutional variables and firm characteristics.Research limitations/implications The main implication of this finding is the positive effect of firms hiring more women in top management roles on remuneration. In addition, the negative effect of Bumiputras suggests that their role is to offer political expedience to the board and thus provide economies of scale through their status to the country.Originality/value This study tests the effect of both gender and ethnicity simultaneously on directors’ remuneration.
VL  - 30
IS  - 2
SN  - 0114-0582
DO  - 10.1108/PAR-02-2016-0021
UR  - https://doi.org/10.1108/PAR-02-2016-0021
AU  - Effiezal Aswadi Abdul Wahab
AU  - Madah Marzuki Marziana
AU  - Jaafar Syaiful Baharee
AU  - Masron Tajul Ariffin
PY  - 2018
Y1  - 2018/01/01
TI  - Board diversity and total directors’ remuneration: evidence from an emerging market
T2  - Pacific Accounting Review
PB  - Emerald Publishing Limited
SP  - 243
EP  - 272
Y2  - 2024/09/23
ER  -