Appointments, Pay and Performance in UK Boardrooms by Gender

Abstract

This article uses UK data to examine issues regarding the scarcity of women in boardroom positions. The article examines appointments, pay and any associated productivity effects deriving from increased diversity. Evidence of gender‐bias in the appointment of women as non‐executive directors is found together with mixed evidence of discrimination in wages or fees paid. However, the article finds no support for the argument that gender diverse boards enhance corporate performance. Proposals in favour of greater board diversity may be best structured around the moral value of diversity, rather than with reference to an expectation of improved company performance.

Female Directors and Firm Performance: Evidence from UK Listed Firms

“…Haslam et al (2010) reports that there is no association between the presence of female directors on a board and firm performance for FTSE100 companies. Gregory- Smith et al (2013) did not find evidence that the presence of females on boards is associated with higher firm performance.…”

“…Firstly, this study uses rigorous econometric techniques in order to address the endogeneity problems (Adams and Ferreira 2009;Liu et al 2014;Strom et al 2014). Secondly, this study uses a larger dataset than previous related studies in the UK (Ryan and Haslam 2005;Gregory-Smith et al 2013). Finally, this study adds analysis of the firms' sizes, as the UK's large listed firms encounter a certain kind of pressure in the composition of their boards' members (Mallin and Ow-Yong 2008).…”

What Types of Companies Have Female and Foreign Directors?

“…As mentioned in section 2, some studies suggest that companies with better performance tend to appoint female directors (e.g., Farrell and Hersch, 2005), but other studies do not find a significant relationship between performance and the presence of females on the board (e.g., Gregory-Smith et al, 2014). We use the ROA and TFP as additional explanatory variables to investigate this relationship in Japan.…”

“…4 Studies from the viewpoint of female labor mainly focus on the issue of the gender gap in compensation (e.g., Bell, 2005;Elkinawy and Stater, 2011;Bugeja et al, 2012) and discrimination in promotion by gender (Bertrand and Hallock, 2001;Elkinawy and Stater, 2011;Matsa and Miller, 2011;Gayle et al, 2012;Conyon, 2014). 5 On the other hand, the major interests of the studies in the field of finance and corporate governance are the effect of the female director on company performance (e.g., Carter et al, 2003;Wolfers, 2006;Adams and Ferreira, 2009;Gul et al, 2011;Ahern and Dittmar, 2012;Dezsö and Ross, 2012;Pathan and Faff, 2013;Matsa and Miller, 2013;Gregory-Smith et al, 2014) and the different management styles of female leaders (e.g., Gul et al, 2011;Huang and Kisgen, 2013;Matsa and Miller, 2014).…”

Board of directors’ composition and performance in French CAC 40 listed firms

“…Most of the studies in the area of the effect of gender diversity of the board were focused on profitability and, so far, there is no consensus in the literature on the association between female presence and corporate performance. Several researches 248 provide that gender diversity leads to increase corporate performance while others argue there is not such relationship (Carter, at al., 2003;Gregory-Smith, et al, 2014). Associated to the above is idea from prior literature on the existence of differences between men and women, risk taking, decision-making, communication and firm performance (Rose, 2007).…”