Gender diversity and firm performances suffering from financial distress: evidence from Indonesia

Abstract

PurposeThis paper aims to demonstrate gender diversity in the structure of corporate governance and test the effect of diversity on the firm performance suffering from financial distress.Design/methodology/approachThe paper is quantitative using a sample of 467 public firms in Indonesia. Data were analyzed into statistics descriptive and the hypothesis was tested using the test of logistic regression.FindingsThe preliminary results of the paper demonstrate the number of firms employing women and men in the structure of corporate governance of 13% on the commissioner board, 7% on the director board and 5% on the audit committee. Based on the test of effect, this paper further found that firms employing women and men (gender diversity) in the structure of the board of commissioners, tend to suffer from financial distress lower than firms only employing men (non-gender diversity).Research limitations/implicationsThis paper is not an effort to make the proportion of voices of women equal to men, however the representation of women at least exists in the structure of corporate governance as part of workforce diversity and inclusivity. In addition, this paper is considered not to use panel data with the purpose of avoiding repetitive data because of the use of a nominal scale in the logistic regression model.Practical implicationsThe finding of the paper is addressed to deliver insights into the current conversation on the issue of women's day with the theme of Each for Equal and to firms in positioning women in the structure of boardrooms.Originality/valueThis paper extends the limited scholarly work on the nexus between gender diversity and financial performance. The framework of social identity theory and the tenet of corporate governance are elaborated to disclose the finding that firm shareholders tend to benefit from gender diversity in the structure of the commissioner board.

Gender Diversity Perspective as Moderation: Does Profitability and Capital Structure Affect Financial Distress during Corona Virus Period?

“…With gender diversity in the company, it will make a lot of considerations and a lot of thoughts that result in low financial distress. This is consistent with studies carried out by Samudra, [37], García & Herrero, [27], Abbas & Frihatni, [38].…”

“…Gender diversity therefore has no bearing on financial hardship. This research is not in line with research from [37,27,38], but in line with research [49,50], [11]. Based on the above statement, H3 is rejected.…”

Does corporate social responsibility mediate the relationship between board diversity and financial distress: evidence from an emerging economy?

“…Women tend to arrive on boards of directors with different backgrounds and experiences than men do, which may result in a different orientation toward the various stakeholders in the organization. In addition, having women on boards of directors has been shown to improve financial performance (Khan and Subhan, 2019;Dedunu and Anuradha, 2020;Abbas and Frihatni, 2023;Loukil et al, 2019;Brahma et al, 2021;Gyapong et al, 2021;Dettori and Floris, 2022). In addition, female board members contribute to better governance through higher attendance and monitoring rates than their male counterparts (Terjesen et al, 2009).…”

A Review Gender diversity dan Environmental, Social, and Governance (ESG) terhadap financial performance

“…Jika ini Terkait dengan konsep gender, struktur organisasi perusahaan akan memiliki pertunjukan fungsi yang dapat melibatkan laki-laki dan perempuan. Mereka adalah bentuk keragaman gender yang dimiliki fungsi yang sama dalam posisi bisnis (Abbas & Frihatni, 2023).…”

“…Penelitian yang dilakukan oleh Loukil, N., Yousfi, O. and Yerbanga, R. ( 2019), menyatakan bahwa eksistensi Perempuan sebagai direktur memiliki reaksi yang positif, karena perempuan memiliki kemampuan yang lebih baik jika berhadapan dengan permasalahan sosial, ekonomi dan l;ingkungan (Loukil, 2019). Hal yang sama juga di paparkan oleh (Abbas & Frihatni, 2023)…”