Gender-Diverse Boards and Firm Value: Evidence from the COVID-19 Pandemic

43 Pages Posted: 28 Jun 2021 Last revised: 5 Mar 2024

See all articles by Leon Zolotoy

Leon Zolotoy

University of Melbourne - Melbourne Business School

Farida Akhtar

Macquarie University

Don O'Sullivan

Melbourne Business School, University of Melbourne

Madhu Veeraraghavan

T.A. PAI Management Institute, Finance Area

Date Written: October 16, 2022

Abstract

This paper studies the impact of board gender diversity on firm value during a crisis period. We provide robust evidence that stocks of firms with gender-diverse boards experienced higher abnormal returns when the negative market sentiment induced by the outbreak of the COVID-19 pandemic was at its peak. In cross-sectional analysis, we find that the documented effect was amplified among financially constrained firms, firms with a longer cash conversion cycle, and firms with higher information uncertainty, while it was mitigated among firms with higher managerial ability. Overall, our findings are consistent with the narrative that investors view gender diverse boards as being better equipped to monitor and advise management during such periods.

Keywords: Board gender diversity, Abnormal returns, Crisis, COVID-19

JEL Classification: G10, G30, M14

Suggested Citation

Zolotoy, Leon and Akhtar, Farida and O'Sullivan, Don and Veeraraghavan, Madhu, Gender-Diverse Boards and Firm Value: Evidence from the COVID-19 Pandemic (October 16, 2022). Available at SSRN: https://ssrn.com/abstract=3869585 or http://dx.doi.org/10.2139/ssrn.3869585

Leon Zolotoy (Contact Author)

University of Melbourne - Melbourne Business School ( email )

200 Leicester Street
Carlton, Victoria 3053 3186
Australia

Farida Akhtar

Macquarie University

North Ryde
Sydney, New South Wales 2109
Australia

Don O'Sullivan

Melbourne Business School, University of Melbourne ( email )

200 Leicester Street
Carlton, Victoria 3053 3186
Australia

Madhu Veeraraghavan

T.A. PAI Management Institute, Finance Area ( email )

Bangalore
Manipal, Karnataka 576104
India
+91-820-2701030 (Phone)

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