Gender and Corporate Crime : Do Women on the Board of Directors Reduce Corporate Bad Behavior?
42 Pages Posted: 28 Mar 2022
Date Written: February 28, 2022
The public debate on mandating gender representation on boards of directors in the United States is close to a boiling point. California introduced a mandatory quota in 2018 and the Nasdaq Stock Market followed suit with new diversity rules in 2021 for all corporations listed on the exchange. While the public discourse focuses on corporate performance, not much is known about the link between gender diversity and corporate normative obedience.
This study innovates by exploring the relationship between boardroom gender representation and corporate compliance with the law. The study examines the impact of gender diversity on corporate obedience in a sample of 660 public corporations. We find that gender diversity has a substantial positive impact on corporate compliance. Notably, every one percent increase in female representation on the board is associated with at least a four percent decrease in the probability that the corporation will be associated with a violation of the law.
The key contributions of this Article to the existing literature are threefold: First, the findings of this Article call for a re-evaluation of gendered theories of female white-collar offending on the basis of empirical data. Second, the Article adds a unique perspective to the broad discussion of environmental, social, and governance (ESG) aspects of corporate purpose. Third, the Article sheds innovative light on the discussion about corporate social responsibility (CSR) and the means to reduce negative externalities produced by corporations.
Keywords: corporate governance, boards, gender, diversity, NASDAQ, quotas, corporate wrongdoing, female offending, white collar crime, feminist criminology
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