Female Board Leadership, Firm Performance, and Corporate Governance: Evidence from China

59 Pages Posted: 6 Nov 2018 Last revised: 22 Jul 2019

See all articles by Fuxiu Jiang

Fuxiu Jiang

Renmin University of China - School of Business

Jun-Koo Kang

Nanyang Technological University (NTU) - Nanyang Business School

Jungmin Kim

School of Accounting and Finance, Hong Kong Polytechnic University

Bing Zhu

Central University of Finance and Economics,School of Accountancy

Date Written: July 5, 2019

Abstract

Using a large sample of Chinese firms, we examine performance differences between firms with female and male chairs and the channels through which such differences arise. After controlling for the presence of female CEOs and non-chair female directors, we find that chairwoman firms perform better than chairman firms. Boards led by chairwomen also play not only a more effective supervisory role (as evidenced by a higher likelihood of director dissension, a lower likelihood of committing accounting fraud, and higher forced CEO turnover- and pay-performance sensitivity) but also a more active managerial role (as evidenced by more value-enhancing risky investment, more innovation activities, and more effective responses to industry-wide shocks). Moreover, the presence of women on boards as chairs is associated with better attendance behavior among independent directors. These results, which are robust to controlling for the self-selection biases and board gender diversity documented in prior literature, suggest that chairwomen play a more effective leadership role than chairmen in board decision making.

Keywords: Female chairperson, Board diversity, Firm performance, Corporate governance, Director dissension, Accounting fraud, Forced CEO turnover, Risk taking

JEL Classification: G20, G30, G32, G34

Suggested Citation

Jiang, Fuxiu and Kang, Jun-Koo and Kim, Jungmin and Zhu, Bing, Female Board Leadership, Firm Performance, and Corporate Governance: Evidence from China (July 5, 2019). Available at SSRN: https://ssrn.com/abstract=3279372 or http://dx.doi.org/10.2139/ssrn.3279372

Fuxiu Jiang

Renmin University of China - School of Business ( email )

Beijing
China

Jun-Koo Kang (Contact Author)

Nanyang Technological University (NTU) - Nanyang Business School ( email )

Nanyang Avenue, Block S3-01b-54
Singapore, 639798
Singapore
(+65) 6790-5662 (Phone)
(+65) 6791-3697 (Fax)

HOME PAGE: http://www.nbs.ntu.edu.sg/nbs_corporate/divisions/bnf/index.asp

Jungmin Kim

School of Accounting and Finance, Hong Kong Polytechnic University ( email )

M757 Li Ka Shing Tower
Hung Hom, Kowloon
Hong Kong
852 2766 7061 (Phone)

Bing Zhu

Central University of Finance and Economics,School of Accountancy ( email )

39 South College Road
Haidian District
Beijing, Beijing 100081
China

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