How Deep is the Labor Market for Female Directors? Evidence from Mandated Director Appointments

68 Pages Posted: 18 Oct 2021 Last revised: 12 May 2022

See all articles by Daniel Greene

Daniel Greene

Clemson University

Vincent Intintoli

Clemson University, Department of Finance

Kathleen M. Kahle

University of Arizona - Department of Finance; European Corporate Governance Institute (ECGI)

Date Written: May 12, 2022

Abstract

We examine the depth of the labor market for female directors following an exogenous shock to demand caused by California Senate Bill 826. Despite a surge in female appointments, new female director qualifications remain stable when benchmarked to control groups, indicating a deep labor market. Relative to the same control groups, we likewise find little evidence that investors view female director appointments more negatively following the law. However, stock returns to new female director appointments do not offset negative returns to the 2018 enactment of the law, suggesting that a limited supply of directors cannot fully explain the negative investor reaction to the mandate.

Keywords: Boards of directors, Gender diversity, Regulation, Labor Market

JEL Classification: G3, G34, G38, K2, K22, J2, J7

Suggested Citation

Greene, Daniel and Intintoli, Vincent and Kahle, Kathleen M., How Deep is the Labor Market for Female Directors? Evidence from Mandated Director Appointments (May 12, 2022). Available at SSRN: https://ssrn.com/abstract=3943718 or http://dx.doi.org/10.2139/ssrn.3943718

Daniel Greene

Clemson University ( email )

101 Sikes Ave
Clemson, SC 29634
United States

Vincent Intintoli

Clemson University, Department of Finance ( email )

Clemson, SC 29634
United States
864-656-2263 (Phone)

Kathleen M. Kahle (Contact Author)

University of Arizona - Department of Finance ( email )

McClelland Hall
P.O. Box 210108
Tucson, AZ 85721-0108
United States
520-621-7489 (Phone)

European Corporate Governance Institute (ECGI) ( email )

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

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