Do female directors reduce corporate misconduct?

64 Pages Posted: 14 Mar 2024

See all articles by David Carter

David Carter

Oklahoma State University - Stillwater - Department of Finance

Corey A. Shank

Miami University

Matthew Wynter

Stony Brook University, College of Business

Date Written: March 3, 2024

Abstract

S&P 500 companies with more violations issued by the U.S. Department of Justice tend to have a higher percentage of female directors. However, we find that, after accounting for gender disparities in local director markets, companies with higher percentages of female directors actually receive fewer violations than their industry peers, particularly companies with recent violations or more women on select committees. After violations, firms with a higher proportion of women on their boards of directors tend to have higher CEO turnover and lower CEO compensation. The findings suggest that gender disparities confound the negative impact of female directors on misconduct.

Keywords: Board gender diversity, corporate governance, female directors, fraud, misconduct

JEL Classification: G30, M14

Suggested Citation

Carter, David A. and Shank, Corey and Wynter, Matthew, Do female directors reduce corporate misconduct? (March 3, 2024). Available at SSRN: https://ssrn.com/abstract=4726813 or http://dx.doi.org/10.2139/ssrn.4726813

David A. Carter (Contact Author)

Oklahoma State University - Stillwater - Department of Finance ( email )

Spears School of Business
Stillwater, OK 74078-4011
United States
405-744-5104 (Phone)
405-744-5180 (Fax)

Corey Shank

Miami University ( email )

Oxford, OH 45056
United States

HOME PAGE: http://coreyshank.com

Matthew Wynter

Stony Brook University, College of Business ( email )

306 Harriman Hall
Stony Brook, NY 11794
United States

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