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This study aims to examine whether a change in the regulatory requirement toward gender quota for corporate leadership significantly affects the demand and therefore, it increases the presence of women directors and women CEOs. Examining the supply-side, the study also examines whether the supply for women directors and women CEOs based on the presence of qualified women who currently hold upper, middle, or lower management positions is positively related with the presence of women directors and women CEOs. Furthermore, based on the critical mass hypothesis, this study examines whether the presence of women CEOs and critical mass for women directors bring significant impacts on firms' financial and environmental, social and corporate governance (ESG) performance during the subsequent period.

Using the multivariate regression analysis, this study empirically examines the impact of the shift in the demand for women directors and CEOs from the enactment of the Greek Law 4403/2016 on gender quota for corporate leadership. This study also examines the impact of the supply for women in corporate leadership, measured by the percentage of women who hold upper, middle, or lower management positions, on the presence of women directors and CEOs. Then, this study examines the impact of women directors and women CEOs on firms' subsequent financial and ESG performance.

Based on a sample of 71 publicly listed Greek firms and 20 Cyprus listed firms as a control group during 2006–2019, the study finds evidence that both the supply-side and the demand-side bring positive effects on greater women participation in corporate boards. However, there is no evidence that the supply and demand affect the presence of women CEOs. The presence of women CEOs has a positive effect on ESG through environmental and social pillars. The study finds evidence to support the critical mass hypothesis that firms with three or more women boards tend to have higher financial and ESG performance.

Understanding the supply and demand for gender diversity in corporate leadership in countries that are considered as lagging is critical to foster the global objective to level the playing field for women to participate in corporate management leadership as important part the United Nations Sustainable Development Goal (UNSDG) 5.5. The positive impact of women directors on corporate financial and social performance can be achieved, especially when the critical mass is reached. This highlights the importance of greater gender representations in corporate boards and top executive level in order to make a meaningful social change.

This study demonstrates that the supply of women who currently hold corporate management positions has positive influence on the presence of women boards. This study also demonstrates that a national legislation that promotes gender diversity for corporate board has a positive impact on board gender diversity among Greek listed firms. This study also highlights the importance of integrating the critical mass perspective in considering the impact of supply and demand for women in corporate leadership on firms' financial and ESG performance.

This study examines the relationship between economic policy uncertainty (EPU) and managers' ex ante strategic choice on firms’ fixed and variable costs structure, i.e. cost rigidity and the moderating effect of government contracts and political connections.

Using a sample of 4,162 US firms during 2003–2019 and EPU measure from Baker et al. (2016), the authors examine the association between EPU and cost rigidity using multivariate regression analysis. The authors also examine the moderating effects of government customers and political connections using the subsampling method.

This study finds that increases in EPU leads to higher cost rigidity, suggesting that managers tend to look ahead and make an ex ante commitment to invest more in fixed costs to avoid congestion costs in anticipation of future product demand during EPU. The study also finds that the presence of government customers and political connections moderates the need for adopting greater cost rigidity.

This study measures firms' cost rigidity based on archival data. Future studies could utilize managers' cost structure choices using firms' internal management cost structure forecasts data to measure cost rigidity to examine the relationship between cost rigidity and EPU.

This study demonstrates that managers tend to make a proactive commitment to invest in fixed inputs when facing demand uncertainty from EPU to avoid congestion costs. This study also highlights the value of having government contracts and political connections by demonstrating that managers are less concerned about the congestion costs, hence weakening the impact of EPU on cost rigidity when they have government as major customers and/or political connections.

This study extends the management accounting literature by documenting that cost rigidity is related to EPU and that the relationship between cost rigidity and EPU also depends on whether the firm has government as major customers and/or political connections or not.