Corporate profitability and effective tax rate: the moderating role of board gender diversity

Alkurdi, Amneh; Almarayeh, Taha; Bataineh, Hanady; Amosh, Hamzeh Al; Khatib, Saleh F. A.

doi:10.1108/jiabr-05-2022-0122

Cited by 5 publications

(4 citation statements)

References 71 publications

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“…The presence of women on the board of directors can influence company decisions regarding tax strategy because of different perspectives on managing risk and complying with regulations. (Alkurdi et al, 2023) shows that more gender-diverse boards of directors tend to pay more attention to ethical aspects of tax compliance. Women on boards often bring greater concern for social issues and legal compliance, including taxes.…”

Section: Tax Avoidancementioning

confidence: 99%

The Effect of Board Gender Diversity on the Company: A Literature Review

Darmawan

2024

JLS

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This study explores the influence of gender diversity in boards of directors on various aspects of corporate performance. Through the literature review method, this research gathers empirical evidence to assess how gender diversity affects risk-taking, social responsibility, and decision-making processes within the firm. The results show that the presence of women on boards can contribute positively to corporate performance, innovation, investment, and ESG issues, while bringing diverse perspectives, experiences, and expertise that support more effective decision-making and risk management. On the other hand, the study also recognizes that underrepresentation of women may reduce the benefits of gender diversity. Furthermore, the presence of women on boards is associated with reduced agency problems, increased dividend payouts and more responsible tax avoidance practices. However, there are mixed views regarding the impact of gender diversity, emphasizing the importance of considering the firm-specific context in evaluating the impact of gender diversity on firm performance. This study contributes to future research by providing a broader and deeper knowledge base on the topic of gender diversity in the context of business and management.

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Section: Tax Avoidancementioning

confidence: 99%

The Effect of Board Gender Diversity on the Company: A Literature Review

Darmawan

2024

JLS

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“…As claimed by Erin et al (2016), the board of directors is well known for ensuring the credibility of financial reporting procedures and the accuracy of the data used to calculate tax obligations, both of which are vital to generating revenue for the government and moving the country forward. Specifically, Alkurdi et al (2023) stated that having a female board member is important and one of the most effective, and that women have a key role to play in supporting initiatives that decrease financial risk and can have an influence on the reputational value of firms. Based on results from research by the International Labor Organization (ILO) on 416 national and multinational companies in Indonesia in June 2020, prioritizing gender in the work environment has brought considerable benefits to a company's business processes.…”

Section: Research Backgroundmentioning

confidence: 99%

“…Board gender diversity (BGD) is term used to describe the present of female board members. In order to determine this variable, this study assessed the present of female board members to all board members (Alkurdi et al, 2023).…”

Section: Board Gender Diversitymentioning

confidence: 99%

“…The ability of a corporation to fulfill its immediate obligations is referred to as liquidity. The liquidity ratio demonstrates the stability of the company's financial position and assesses the effectiveness of management in handling funds (Alkurdi et al, 2023). The current ratio, which calculates the proportion of current assets to current liabilities, shows how well the company can meet its short-term obligations.…”

Section: Liquiditymentioning

confidence: 99%

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CORPORATE PROFITABILITY, AUDIT QUALITY & BOARD GENDER DIVERSITY: DOES IT INFLUENCE TAX AVOIDANCE?

Amanda,

Fitriana,

Mapuasari

2023

ULTIMA Accounting

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- This study aims to determine the effect of company profitability and audit quality on tax avoidance, where board gender diversity will be examined as a moderating variable. Several previous studies found inconsistent results regarding the influence of each variable on tax avoidance. In addition, this study extends earlier research, which highly suggests examining the audit quality. Further, in Indonesia, there is a demand for including women in the boardroom, while the last 2 years show that women's participation is decreasing. It indicates that the variables examined are interesting to further investigate. Purposive sampling was used as the sampling method, which generated 15 companies from mining, technology, transportation, and logistics listed on the Indonesia Stock Exchange for 2019–2021. The collected data will be analyzed using moderate regression analysis (MRA). The empirical results showed that both corporate profitability and audit quality positively influence tax avoidance. However, it was observed that board gender diversity does not moderate the relationship between company profitability and audit quality on tax avoidance. These results imply that a profitable company has a relatively high tendency to do tax avoidance, but the gender diversity in the boardroom is not sufficient to influence those relationships. Whatever the gender of the board of directors and certain traits embedded in each gender classification, once they come to the work field, those differences can be neglected because of their ability to work professionally. Keywords: Audit Quality; Board Gender Diversity; Corporate Profitability; Tax Avoidance

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The nexus of tax avoidance and firms characteristics – does board gender diversity have a role? Evidence from an emerging economy

Hossain,

Islam,

Ali

et al. 2024

APJBA

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PurposeThis study examines the moderating role of female directors on the relationship between the firms’ characteristics and tax avoidance in an emerging economy.Design/methodology/approachThis study employs the second-generation unit root test and the generalised method of moments (GMM) techniques. The Kao residual cointegration test corroborates a long-run cointegration among variables.FindingsFemale directors demonstrate mixed and unusual findings. No significant impact of female directors on tax avoidance is found. In addition, the presence of female directors does not show any negative or significant moderating impacts on the relationship between leverage, firm age, board size and tax avoidance. However, having more female directors can negatively and significantly moderate the relationship between more profitable firms, larger firms and tax avoidance. These findings show that the board of directors could use the presence of female directors to maximise their opportunistic behaviour, such as to avoid tax.Research limitations/implicationsResearch limitations – The study is limited by considering only 62 listed firms. The scope could be extended to include non-listed firms.Practical implicationsResearch implications – There is increasing pressure for female directors on boards from diverse stakeholders, such as the European Commission, national governments, politicians, employer lobby groups, shareholders, and Fortune and Financial Times Stock Exchange (FTSE) rankings. This study provides input to decision-makers putting gender quota laws into practice. Our findings can help policy-makers adopt regulatory reforms to control tax avoidance practices and enhance organisational legitimacy. Policymakers can change their policy to include female directors up to the threshold suggested by the critical mass theory.Originality/valueThis is the first attempt in Bangladesh to explore the role of female directors in the relationship between the firms' characteristics and tax avoidance. The current study has significant ramifications for bringing gender diversity into practice as a component of good corporate governance.

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Corporate profitability and effective tax rate: the moderating role of board gender diversity

Cited by 5 publications

References 71 publications

The Effect of Board Gender Diversity on the Company: A Literature Review

The Effect of Board Gender Diversity on the Company: A Literature Review

CORPORATE PROFITABILITY, AUDIT QUALITY & BOARD GENDER DIVERSITY: DOES IT INFLUENCE TAX AVOIDANCE?

The nexus of tax avoidance and firms characteristics – does board gender diversity have a role? Evidence from an emerging economy

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