The Impact of Board Gender Composition on Dividend Payouts

51 Pages Posted: 10 Oct 2016 Last revised: 13 Apr 2017

See all articles by Jie Chen

Jie Chen

Leeds University Business School, University of Leeds

Woon Sau Leung

The University of Edinburgh Business School, The University of Edinburgh

Marc Goergen

IE Business School, IE University; European Corporate Governance Institute (ECGI)

Date Written: October 1, 2016

Abstract

This paper investigates whether female independent directors are more likely to impose high dividend payouts. We find evidence that firms with a larger fraction of female directors on their board have greater dividend payouts. This finding is robust to alternative econometric specifications, and alternative measures of dividend payouts. The positive effect of gender composition on dividends remains when we employ propensity score matching and the instrumental variable approach to address potential endogeneity concerns. Furthermore, we find that board gender composition significantly increases dividends only for firms with weak governance, suggesting that female directors use dividend payouts as a governance device.

Keywords: Gender Composition, Board of Directors, Dividend Payout, Corporate Governance

JEL Classification: G30, G35, J16

Suggested Citation

Chen, Jie and Leung, Woon Sau and Goergen, Marc, The Impact of Board Gender Composition on Dividend Payouts (October 1, 2016). Journal of Corporate Finance, Volume 43, pp. 86-105, April 2017, DOI: org/10.1016/j.jcorpfin.2017.01.001, European Corporate Governance Institute (ECGI) - Finance Working Paper No. 488/2016, Available at SSRN: https://ssrn.com/abstract=2849529 or http://dx.doi.org/10.2139/ssrn.2849529

Jie Chen (Contact Author)

Leeds University Business School, University of Leeds ( email )

Leeds LS2 9JT
United Kingdom

HOME PAGE: http://https://business.leeds.ac.uk/about-us/our-people/staff-directory/profile/jie-chen-1/

Woon Sau Leung

The University of Edinburgh Business School, The University of Edinburgh ( email )

29 Buccleuch Pl
Edinburgh, Scotland EH8 9JS
United Kingdom

Marc Goergen

IE Business School, IE University ( email )

Finance Department
Maria de Molina, 12
Madrid, 28006
Spain

HOME PAGE: http://www.ie.edu/business-school/faculty-and-research/faculty/marc-goergen/

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

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