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

Journal of Management Studies, 46:5, July 2009

65 Pages Posted: 8 Jul 2015 Last revised: 20 Jul 2015

See all articles by Toyah Miller

Toyah Miller

Indiana University - Kelley School of Business - Management & Entrepreneurship

Maria Triana

University of Wisconsin - Madison

Date Written: July 6, 2009

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.

Keywords: board of directors, diversity, gender, race, innovation, reputation, firm performance

Suggested Citation

Miller, Toyah and Triana, Maria, Demographic Diversity in the Boardroom: Mediators of the Board Diversity – Firm Performance Relationship (July 6, 2009). Journal of Management Studies, 46:5, July 2009, Available at SSRN: https://ssrn.com/abstract=2627366

Toyah Miller

Indiana University - Kelley School of Business - Management & Entrepreneurship ( email )

Bloomington, IN 47405
United States

Maria Triana (Contact Author)

University of Wisconsin - Madison ( email )

716 Langdon Street
Madison, WI 53706-1481
United States

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