Gender diversity in large listed Indian companies

Abstract

This paper aims to examine the effectiveness of gender diverse boards on financial performance in large listed Indian companies by taking a resource dependency perspective. Gender diverse board is measured by presence of the independent female director on the board. Further, financial performance is measured by the market performance measure taking Tobin’s Q. This relationship is examined by collecting information for eleven financial years from 2003 -13. Panel regression model is employed to assess the proposed relationship. The analysis confirms that independent gender diverse boards significantly affect financial performance. Another important revelation of the study is that the financial performance of company having gender diverse boards increases with board size

Effect of gender diversity on the financial performance of insurance firms in Kenya

“…Both studies found that gender diversity and firm performance are positively associated. The findings of Haldar et al, (2015) in India confirmed this positive relationship and support the findings in Malaysia. In Nigeria, studies by Oba and Fodio (2013), Garba and Abubakar (2014) and Oyewale et al (2016) produced similar trend.…”

“…Similar to studies from developed markets, findings from emerging markets offer mixed results though a large number of empirical works show positivity between gender diversity and performance. While a number of studies from emerging markets (Julizaerma & Sori, 2012;Oba & Fodio, 2013;Shehata, 2013;Garba & Abubakar, 2014;Haldar, Shah & Rao, 2015;Jonty & Mokoteli, 2015;Tu, Loi & Yen, 2015;Oyewale, Oloko & Olweny, 2016;Hassan & Marimuthu, 2018; Lee-Kuen, Sok-Gee & Zainudin, 2017) report positive relationship, others (Yasser, 2012;Dabor, Isiavwe, Ajagbe & Oke, 2015: Kilic, 2015Abu, Okpeh, & Okpe, 2016;Solakoglu & Demir, 2016;Hassan & Marimuthu, 2018) indicate either none or negative association between the two variables. Several studies done in Malaysia on the relationship between gender diversity and performance have also reported positive results.…”

Do Women on Boards affect Firm's Financial Performance? Evidence from Indian IPO Firms

“…Financial Performance is the major element that incentivises the investors to make investments into a firm in the expectations of gaining good returns, and it is on this basis that the performance of the board of directors is also evaluated. We measured financial performance by using a market based measure rather than the accounting based measure, since the accounting based measures are based on the past results and might not reflect the changes in the governance norms immediately (Haldar et al, 2015).…”

“…Secondly, it reflects the market's expectations of future earnings and is, thus, a good proxy for a firm's competitive advantage (Montgomery & Wernerfelt, 1988). Hence, Tobin's Q was used as a proxy for measuring the performance, based on the work of Ahern and Dittmar (2012), Haldar et al (2015), and Campbell et al (2008) for various years. Tobin's Q is calculated using the Chung and Pruitt (1994) formula, which is, market valuation of shares plus debt divided by the total assets.…”

“…It is also imperative to take firm size into consideration because the firm financial performance is likely to be affected by the size of the firm, as large firms have larger abilities to influence performance (Short & Keasy, 1999). Hence, based on several studies (Haldar et al, 2015;Campbell & Mínguez-Vera, 2008;Yasser et al, 2017), it was included as a control variable.…”