Gender Diversity and the Spillover Effects of Women on Boards
Corporate Governance: An International Review, Forthcoming
49 Pages Posted: 12 Dec 2014 Last revised: 20 Aug 2020
Date Written: August 10, 2020
Research Question/Issue: This study seeks to understand the circumstances under which board behavior is affected by gender diversity. The ‘Reasoned Action Approach’ (Fishbein & Ajzen, 2010) is used as a lens through which to assess the extent that the behavior of the board varies with its gender diversity.
Research Findings/Insights: The study uses archival data from a panel sample of 80,395 directorships observed between 1998 and 2012. Boardroom gender diversity is significantly related to director personal responsibility (board attendance), CEO accountability, and risk taking. Our findings highlight the key importance of the exposure of male directors to women directors on boards beyond the focal board. This suggests a positive externality, or a spillover effect.
Theoretical/Academic Implications: The empirical findings of this study highlight the importance of allowing for the operation of social norms when studying boardroom decision making. Experience gained by male directors of working with women directors on other boards, beyond the focal board, is shown to enable women directors to contribute more effectively.
Practitioner/Policy Implications: This study offers encouragement to policy makers intent on increasing the presence of women on corporate boards. These results point to a spillover effect: there is an observed impact of women on boards that acts not only directly on the board on which they sit but also through the network of boards on which their male counterparts sit.
Keywords: Women on boards; Spillover; Gender diversity; Reasoned action approach
JEL Classification: G10, G34
Suggested Citation: Suggested Citation