The Economic Consequences of a 'Glass-Ceiling': Women on Corporate Boards and Firm Value
AFA 2016 San Francisco Meetings Paper
58 Pages Posted: 25 Oct 2013 Last revised: 8 Nov 2017
Date Written: November 7, 2017
We analyze capital market reactions to exogenous departures of female board members due to death and illness. Theoretically, the "glass-ceiling" effect implies that a more rigorous selection of female board members leads to superior qualifications of women on corporate boards. We find in short- and long-run event studies that the capital market responds more negatively to exogenous departures of women. This effect is more pronounced in countries where the selection of women is more stringent and fewer women serve on boards. Thus, the "glass-ceiling" effect leads to an over-performance of the (few) women who make it to the top.
Keywords: Female board representation, exogenous retirements, gender quota, firm value, glass ceiling
JEL Classification: G32, G34
Suggested Citation: Suggested Citation