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Article
Publication date: 30 June 2022

Jagvinder Singh, Shubham Singhania and Deepti Aggrawal

This study aims to evaluate the impact of gender diversity on corporate boards on firms’ financial performance in the context of the Indian information and technology (IT…

Abstract

Purpose

This study aims to evaluate the impact of gender diversity on corporate boards on firms’ financial performance in the context of the Indian information and technology (IT) sector. The Companies Act 2013 brought forth mandatory provisions for the appointment of women directors for a certain class of companies. This study explores the case of board gender diversity in the Indian IT sector’s unique setting.

Design/methodology/approach

The study uses a fixed effect panel data regression model to achieve its objectives. Two widely used diversity measures, Blau Index and Shannon Index, have been used to enhance the robustness of the results.

Findings

The results of the study indicate an insignificant relationship between gender diversity and firms’ financial performance. Even the diversity indices portray insignificant results confirming the outcomes of the study. The study indicates that IT sector firms have not been able to leverage the benefits of board gender diversity.

Research limitations/implications

The results of the study have important policy implications for the government, regulatory bodies and corporates. The outcomes point out that the benefits that could have accrued based on the diversity aspect could not be harnessed, as the women’s representation on corporate boards is extremely low. Policymakers and government shall focus on devising stringent laws so that better representation of women directors can be used for the interests of the firms.

Originality/value

The study is an attempt to fill the gap in the extant literature which has a scarce number of studies conducted in the unique setting of the IT sector (both in developed and developing economies). To the best of the authors’ knowledge, this is the first study on the influence of board gender diversity in the IT sector of a developing economy, backed by socio-cultural reasons.

Details

Society and Business Review, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-5680

Keywords

Article
Publication date: 5 July 2022

Ajab Khan, Mustafa Kemal Yilmaz and Mine Aksoy

The purpose of this study is to investigate the impact of board demographic diversity on the dividend payout policy in Turkish capital markets.

Abstract

Purpose

The purpose of this study is to investigate the impact of board demographic diversity on the dividend payout policy in Turkish capital markets.

Design/methodology/approach

Using a sample of 67 non-financial companies listed on Borsa Istanbul 100 index from 2013 to 2018, this study examines the influence of board demographic diversity on dividend payout policies in Turkish capital markets. The authors also create a Demographic Board Diversity Index (DBDI) to estimate the composite cognitive diversity. The authors use dividend payment probability, dividend payout ratio, and dividend yield to measure the dividend policy and employ panel logit and tobit regression models.

Findings

The results indicate that diversity in nationality, experience and educational background play an influential role in encouraging companies to pay high dividends, while gender, tenure and age diversity are insignificant in affecting dividend payments. The findings also suggest that the DBDI positively affects the companies in formulating the dividend payout policies. Finally, the findings show that the family-owned companies with diverse board members have a negative influence on dividend payment intensity.

Originality/value

The results offer valuable insights for companies and policymakers in emerging markets to develop a more refined governance structure accommodating board demographic diversity attributes to mitigate agency conflicts between controlling and minority shareholders through setting up effective dividend payout policies.

Details

EuroMed Journal of Business, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1450-2194

Keywords

Article
Publication date: 5 May 2022

Fathia Elleuch Lahyani

This study aims to examine the association between carbon disclosure and board diversity by drawing on a multiple theoretica frameworks that embody five dimensions…

Abstract

Purpose

This study aims to examine the association between carbon disclosure and board diversity by drawing on a multiple theoretica frameworks that embody five dimensions, namely, board nationality, gender, independence, tenure and age, within firms with varying decarbonization performance and industry carbon impact.

Design/methodology/approach

This study uses the generalized method of moments approach. The sample includes Société des Bourses Françaises 120 (SBF 120) nonfinancial French listed firms for a period of 10 years (2010–2019).

Findings

Being sensitive to increased stakeholders’ information demands, diverse boards tend to disclose a higher volume of carbon information to improve environmental transparency and protect firm legitimacy. Findings show that board independence and nationality play a key role in enhancing carbon disclosure.

Research limitations/implications

The authors’ evidence underscores the crucial role of board diversity in shaping sustainability strategies and disclosure in an economy targeting carbon neutrality. The study encourages management and policymakers to increase board diversity that goes beyond gender diversity.

Originality/value

To the best of authors’ knowledge, this study is the first to investigate the role of board diversity as a multidimensional concept in enhancing the carbon disclosure of SBF 120 large firms, which are subject to communicating their contributions to reducing their carbon footprint.

Details

Accounting Research Journal, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1030-9616

Keywords

Article
Publication date: 21 June 2022

Doaa Shohaieb, Mahmoud Elmarzouky and Khaldoon Albitar

Using textual analysis, this paper aims to measure diversity management disclosure; it also explore the relationship between corporate governance and diversity management…

Abstract

Purpose

Using textual analysis, this paper aims to measure diversity management disclosure; it also explore the relationship between corporate governance and diversity management disclosure.

Design/methodology/approach

The study is based on a sample of the UK FTSE all-share non-financial organisations over the period from 2013 to 2019. We used a computer-aided textual analysis, and we used a bag of words to score the sample annual reports.

Findings

The results show that the mean of the diversity management disclosure level is very low. Also, there is a positive relationship between the board size, women on board and board independence and the level of diversity management disclosure. The relationship is higher with more board members, women on board and more independent directors, aligning with previous literature.

Practical implications

The implications of this research affect stakeholders and organisations which reflects the importance of communicating diversity practices and researchers by facilitating measuring objectively firms’ diversity management practices that have not been applied previously in the field of diversity.

Originality/value

With different incidents taking place around the globe, such as the incident of George Floyd and the increased attention to diversity, organisations are under increasing social and political pressure to reflect on their diversity management practices. Previous literature has examined firms’ diversity practises from different perspectives, but to the best of the authors’ knowledge, this is the first paper to measure diversity management disclosure.

Details

International Journal of Accounting & Information Management, vol. 30 no. 4
Type: Research Article
ISSN: 1834-7649

Keywords

Article
Publication date: 31 May 2022

Omar Kachkar and Mustafa K. Yilmaz

This study aims to examine diversity in the composition of Shariah supervisory boards (SSBs) of Islamic banks (IBs). It investigates diversity from two perspectives…

Abstract

Purpose

This study aims to examine diversity in the composition of Shariah supervisory boards (SSBs) of Islamic banks (IBs). It investigates diversity from two perspectives: existing composition of SSBs and the regulatory frameworks and standards of selected Organisation of Islamic Cooperation countries. Diversity characteristics include education, nationality, gender and age.

Design/methodology/approach

A list of all full-fledged Islamic commercial banks (FFICBs) globally has been carefully prepared and confirmed. Conventional banks with Islamic windows, non-commercial banks, takaful companies and other Islamic financial institutions are excluded. The available profiles of 428 SSB members have been scrutinised and analysed. These board members occupy 522 SSB positions in 238 FFICBs operating in 52 countries around the globe. From the regulatory perspective, 12 national and international Shariah governance frameworks and standards have been examined.

Findings

Findings of this paper indicate various levels of diversity in SSBs of the reviewed IBs. The level of diversity in educational background and in the nationality of SSBs can be described as generally acceptable. However, a lack of diversity in gender and age among SSB members is evidently observed in IBs. While the lack of age diversity in SSBs may be relatively justified as a common trend in the composition of corporate boards, SSBs of IBs are seriously lagging behind in gender diversity. On the regulatory level, this study concluded that provisions on diversity as a requirement in SSBs are almost non-existent in the existing regulatory frameworks and standards.

Research limitations/implications

The major limitation of this study is the lack of available information on the SSB members.

Practical implications

This paper provides insights for IBs and policymakers concerned with the corporate governance of IBs and all Islamic financial institutions. First, it offers an excellent bird’s-eye view of the status of diversity in SSBs of IBs. Second, it motivates policymakers and standard-setting bodies to ensure, through the relevant regulatory frameworks, adequate levels of diversity in the composition of SSBs. Diversity in SSBs of IBs and Islamic financial institutions should be given special emphasis, not only in boards and top management positions but also in the workplace. This is of profound significance to the reputation of Islamic finance industry which has been recently under mounting pressure to translate the rhetoric about the Islamic finance industry being ethical, fair, just, equitable and inclusive into genuine implementations.

Originality/value

To the best of the authors’ knowledge, this study is the first of its kind to examine the diversity of SSB members from the regulatory as well as from the implementation perspective.

Details

International Journal of Ethics and Systems, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2514-9369

Keywords

Article
Publication date: 19 May 2022

Rupjyoti Saha and Santi Gopal Maji

This study aims to examine the impact of board human capital diversity, measured by educational qualification diversity and gender diversity on the financial performance…

Abstract

Purpose

This study aims to examine the impact of board human capital diversity, measured by educational qualification diversity and gender diversity on the financial performance of Indian firms after controlling corporate governance (CG) and firm-specific variables.

Design/methodology/approach

This study is based on a panel data set of top 100 listed Indian firms for a period of five years. The authors use Blau index and Shannon index to compute qualification diversity. The authors use three-stage least square (3SLS) model to deal with the potential endogeneity issue in the association of human capital diversity variables and other CG variables with firm performance. Further, the authors adopt generalized estimating equation (GEE) model for robustness check.

Findings

The authors find a significant positive impact of board’s educational diversity as well as gender diversity on the financial performance of firms. Additionally, they extricate highly significant positive interaction impact of board’s educational diversity and gender diversity on the financial performance of firms. Further, the results indicate a significant positive impact of board size, board independence, ownership concentration, family ownership and audit committee independence on firm performance, while CEO duality exhibits a significant negative impact on firm performance.

Originality/value

This study fills the existing gap in literature by extending the performance implications of board’s human capital diversity for top listed Indian firms.

Details

Journal of Indian Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1755-4195

Keywords

Article
Publication date: 10 February 2022

Isaac Boadi, Raymond Dziwornu and Daniel Osarfo

The marginalization of women on boards is a heavily discussed topic across the world, especially in Ghana. Apart from estimating the link between boardroom gender diversity

Abstract

Purpose

The marginalization of women on boards is a heavily discussed topic across the world, especially in Ghana. Apart from estimating the link between boardroom gender diversity and technical efficiency of banks, this study aims to test the presence of upper echelons theory in the Ghanaian banking sector.

Design/methodology/approach

The study examines data from 2000 to 2019 annual reports of 23 banks in Ghana. The stochastic frontier analysis is used to estimate the impact of boardroom gender diversity on technical efficiency of banks in Ghana.

Findings

This study finds that greater boardroom gender diversity generates technical efficiencies for banks. The results remain unchanged after accounting for bank types (listed and non-listed). Thus, all banks benefit in terms of technical efficiency from more boardroom gender diversity. The upper echelons theory is validated in the Ghanaian banking context. Overall, the study supports pro-gender diversity on boards.

Practical implications

The results have implications at corporate, social and national levels. It supports the need for policies that improve greater boardroom gender diversity.

Originality/value

This study adds to a growing number of non-developed countries by investigating the link between the boardroom gender diversity and technical efficiency of banks in Ghana, a country which historically has had minimal female participation in the workforce. New insight is, therefore, offered into this relationship by using data which examines the technical efficiency of banks periods before and after the Women in Finance Charter in 2016.

Details

Corporate Governance: The International Journal of Business in Society, vol. 22 no. 5
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 11 April 2022

Moncef Guizani and Gaafar Abdalkrim

The purpose of this paper is to examine the impact of board gender diversity on firm financial distress for a sample of 367 non-financial firms listed on Bursa Malaysia…

Abstract

Purpose

The purpose of this paper is to examine the impact of board gender diversity on firm financial distress for a sample of 367 non-financial firms listed on Bursa Malaysia over the period from 2011 to 2019.

Design/methodology/approach

The study employs both panel logistic regression and dynamic generalized method of moments estimator to determine the impact of board gender diversity on the likelihood of financial distress. Altman Z-score model is used as a proxy for financial distress indicator. The bigger the Z-score, the smaller the risk of financial distress.

Findings

The results show that board gender diversity could help to improve board effectiveness by preventing corporations from being too exposed to financial distress and bankruptcy. In particular, whether they are independent or inside members, women directors are likely to reduce the likelihood of financial distress. The results also show that the effect of female directors on the likelihood of financial distress is strengthened through more board independence. The results are consistent with those in prior research that documents the benefits of board gender diversity.

Practical implications

This paper provides insights for corporate decision makers in emerging economies, helping them to determine the board's design in terms of roles and composition that promote governance practices and prevent financial troubles. Furthermore, the findings of this study may be useful regulators as they shed light on the importance to undertake measures and reforms to promote board effectiveness by the introduction of gender diversity. Finally, this study also offers implications for society in general, considering that the practice of enhancing board gender diversity can significantly safeguard the interest of a wide range of stakeholders by reducing the chances of corporate bankruptcy.

Originality/value

While prior research has examined the effect of board gender diversity on firm performance, this study is the first to investigate the effect of board gender diversity on the likelihood of financial distress in Malaysia.

Details

Asia-Pacific Journal of Business Administration, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1757-4323

Keywords

Article
Publication date: 1 April 2022

Antonio Prencipe, Danilo Boffa, Armando Papa, Christian Corsi and Jens Mueller

The purpose of this study is to analyze the impact of human capital related to gender and nationality diversity in boards of directors on the innovation of university…

Abstract

Purpose

The purpose of this study is to analyze the impact of human capital related to gender and nationality diversity in boards of directors on the innovation of university spin-offs (USOs) in their entrepreneurial ecosystem. Following the intellectual capital (IC) framework and the resource dependence theory, upper echelons theory and critical mass theory, it hypothesizes that the relationship between board diversity and USOs’ firm innovation is non-linear.

Design/methodology/approach

To test the research hypotheses empirically, a sample of 827 Italian USOs over the period 2009–2018 was analyzed using zero-inflated Poisson regression modeling. A robustness test was also performed.

Findings

Gender obstacles remain in USOs’ entrepreneurial ecosystem, with little involvement of women in boards, and the benefits of human capital for firm innovation emerge with increased female representation. Nevertheless, a few foreign-born directors embody valued IC in terms of human capital from an internationally linked entrepreneurial ecosystem, which decreases with more foreign-born directors due to communication costs and coordination problems.

Research limitations/implications

The emerging non-linear relationships imply that gender- and nationality-diverse boards in USOs constitute critical human capital factors boosting the devolvement of entrepreneurial processes, in terms of firm innovation, in university entrepreneurial ecosystems.

Originality/value

This study contributes significantly to the move from traditional corporate governance analysis through an IC framework, fostering an understanding of the role of human capital and its diversity determinants in spurring firm innovation among USOs considering the university entrepreneurial ecosystem.

Details

Journal of Intellectual Capital, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1469-1930

Keywords

Article
Publication date: 18 October 2021

Tao Wang

The purpose of this paper is to investigate the effect of board human capital diversity on corporate innovation. Moreover, it examines the moderating effect of internal…

Abstract

Purpose

The purpose of this paper is to investigate the effect of board human capital diversity on corporate innovation. Moreover, it examines the moderating effect of internal social capital on the relationship between board human capital diversity and corporate innovation.

Design/methodology/approach

The hypotheses are tested using a data set on Standard & Poor’s 1500 firms from 2000 to 2015. To overcome omit variable bias and reverse causality, this paper uses change-on-change regression by exploring the exogenous shock of the death of the directors.

Findings

Findings show that board industry diversity has a curvilinear relationship with corporate innovation. In addition, the board co-tenure experience, a key factor of internal social capital, can mitigate the risk of board industry diversity and improve corporate innovation.

Originality/value

Prior studies mostly considered the demographic dimension of diversity and, therefore, have overlooked how other dimensions influence firms. This paper considers the human capital dimension of board diversity and investigates the effect of board industry diversity on the firm’s innovation outcome. In addition, this paper also addresses the question of whether the interaction of different director attributes, namely, board human capital and board internal social capital, can complement each other to enhance corporate innovation.

Details

Corporate Governance: The International Journal of Business in Society, vol. 22 no. 4
Type: Research Article
ISSN: 1472-0701

Keywords

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