Effect of gender diversity on corporate soundness and social contribution

Abstract

This study investigates whether gender diversity within a company has a positive effect on corporate soundness and social contribution. We collect the data of female employment status, corporate soundness, and social contribution, and then we perform empirical tests using 1524 Korean firm‐year observations from 2012 to 2020. From the empirical results, we find that firms with high gender diversity have more corporate soundness than those with low gender diversity. We also find that there is a positive association between the level of gender diversity and social contribution. Our findings imply that by increasing the ratio of female employees, companies can create a more stable and rigorous corporate climate, and consequently improve the corporate soundness and social contribution. This study supports the importance of females in the workforce by presenting empirical evidence that female employment helps improve corporate soundness and social contribution.

Environmental Corporate Social Responsibility, Green Talent Management, and Organization’s Sustainable Performance in the Banking Sector of Oman: The Role of Innovative Work Behavior and Green Performance

“…The demographic data for this study was skewed toward male respondents, which can be one of the potential limitations. Due to the importance of female employees in the workforce [75], future studies can consider having equal representation of male and female respondents for better generalizability of the results. Another promising direction for future research concerns using an exploratory qualitative approach to build industry specific measures [76].…”

Breaking the glass ceiling: gender equality practices in a Japanese bank

“…Drawing upon upper echelons theory and resource dependency theory, having more female managers improves the strategic decision-making process (Dwyer et al , 2003; Lyngsie and Foss, 2017) and creates a more stable and rigorous corporate culture (Rhee et al , 2022). Consequently, the increase in the number of female managers in contact with customers in branches and of female directors with branch experience has allowed different opinions and branch views to be heard and decisions to be made compared to when boards and branches were male-dominated (Mazzotta and Ferraro, 2020; Melero, 2011; Rhee et al , 2022).…”

“…The presence of women on boards can also help attract talented employees (Hillman et al , 2007; Loukil et al , 2019; Rose, 2007; Singh and Vinnicombe, 2004). Finally, having women at the top can improve non-financial information disclosure (Ramon-Llorens et al , 2021) and a company’s soundness and social contribution (Rhee et al , 2022).…”

“…Further research on the relationships between the financial and non-financial outcomes of promoting gender equality in an organisation since it began promoting gender equality would be vital. Previous research has focused mainly on the outcomes of increasing the number of female senior managers (Foss et al , 2022; Rhee et al , 2022). However, research exploring the mechanism of the relationships between financial and non-financial outcomes of promoting gender equality in an organisation over time, until it has reached a stage of appointing female senior managers and managers, has not been conducted.…”

ESG disclosure in G7 countries: Do board cultural diversity and structure policy matter?

“…Most recent empirical studies dealing with board diversity and its potential effect on sustainability examine gender diversity rather than other features of diversity such as culture (Galletta et al, 2022; Khatri, 2023; Rhee et al, 2023; Wasiuzzaman & Subramaniam, 2023). Existing literature on the role of BCDIV is scarce, especially for those studying its effect on ESG disclosure.…”