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Demographic Diversity in the Boardroom: Mediators of the Board Diversity - Firm Performance Relationship

32 Pages Posted: 27 May 2009  

Toyah Miller

affiliation not provided to SSRN

María del Carmen Triana

affiliation not provided to SSRN

Abstract

Whereas the majority of research on board diversity explores the direct relationship between racial and gender diversity and firm performance, this paper investigates mediators that explain how board diversity is related to firm performance. Grounded in signalling theory and the behavioural theory of the firm, we suggest that this relationship operates through two mediators: firm reputation and innovation. In a sample of Fortune 500 firms, we find a positive relationship between board racial diversity and both firm reputation and innovation. We find that reputation and innovation both partially mediate the relationship between board racial diversity and firm performance. In addition, we find a positive relationship between board gender diversity and innovation.

Suggested Citation

Miller, Toyah and del Carmen Triana, María, Demographic Diversity in the Boardroom: Mediators of the Board Diversity - Firm Performance Relationship. Journal of Management Studies, Vol. 46, No. 5, pp. 755-786, July 2009. Available at SSRN: https://ssrn.com/abstract=1410337 or http://dx.doi.org/10.1111/j.1467-6486.2009.00839.x

Toyah Miller (Contact Author)

affiliation not provided to SSRN

María Del Carmen Triana

affiliation not provided to SSRN

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