The Effect of Board Gender Diversity on R&D

58 Pages Posted: 30 Aug 2018 Last revised: 11 Sep 2018

See all articles by Ofra Bazel-Shoham

Ofra Bazel-Shoham

Temple University - Fox School of Business and Management

Tamar Almor

College of Management (Israel) - School of Business Administration

Sang Mook Lee

Pennsylvania State University - Great Valley School of Graduate Professional Studies

Date Written: August 29, 2018

Abstract

In this paper, we propose that gender affects the ambidextrous behavior of a firm. Subsequently, we study this empirically by using a micro‐foundational approach. Building on behavioral ambidexterity and the incentive approach to ambidexterity, we construct a theoretical argument that the male-female gender identity of directors influences the exploitative and explorative behavior of organizations. This theory is then tested empirically using a data base that includes individual data for CEOs and board members in 44 countries, from 1999 to 2014, for 18,881 company-year pairs.

Our findings show that gender diverse boards of directors are generally more conservative regarding investments in risky explorative behaviour, measured as R&D investment. The findings further show that gender diverse boards do encourage equity-based remuneration systems, which in turn, boost long-term explorative behaviour. Our findings show that gender diverse boards result in more complex organizational outcomes than assumed originally. Our data show that even gender diverse boards which have a minority of women behave differently in terms of the decisions made and the resulting outcome for ambidextrous organizational behavior.

Keywords: Board, Research & Development, gender effects

Suggested Citation

Bazel-Shoham, Ofra and Almor, Tamar and Lee, Sang Mook, The Effect of Board Gender Diversity on R&D (August 29, 2018). 2018 Engaged Management Scholarship Conference: Philadelphia, PA; Fox School of Business Research Paper No. 18-025. Available at SSRN: https://ssrn.com/abstract=3240783 or http://dx.doi.org/10.2139/ssrn.3240783

Ofra Bazel-Shoham (Contact Author)

Temple University - Fox School of Business and Management ( email )

Philadelphia, PA 19122
United States

Tamar Almor

College of Management (Israel) - School of Business Administration ( email )

7 Yitzhak Rabin Blvd.
P.O. Box 25072
Rishon LeZion, 75190
Israel

Sang Mook Lee

Pennsylvania State University - Great Valley School of Graduate Professional Studies ( email )

30 E. Swedesford Road
Malvern, PA 19355
United States
610-725-5391 (Phone)

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