The Diversity of Corporate Board Committees and Firm Financial Performance

Carter, David A.; D’Souza, Frank P.; Simkins, Betty J.; Simpson, Wayne

doi:10.2139/ssrn.972763

Cited by 70 publications

(80 citation statements)

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“…Finally, and in line with past studies (Carter et al, 2003(Carter et al, , 2010Johnston and Malina, 2008 (Beiner et al, 2006;Ntim et al, 2012) and hence, such organizations are more likely to be highly valued by the stock market. Therefore, we conjecture that sales growth (SGR) will correlate positively to market valuation.…”

Section: Dependent Independent and Control Variablessupporting

confidence: 84%

“…This can lead to situation whereby BDIV and Q are jointly and dynamically determined by organizational-specific differences, such as organizational culture, complexity and managerial talent (Guest, 2009), which simple OLS regressions may not be able to detect (Gujarati, 2003;Wooldridge, 2010), and thereby resulting in misleading findings (Hausman, 1978;Beiner et al, 2006;Dale-Olsen et al, 2013;Triana et al, 2013). As such, and given the panel nature of our data, as well as in line with past studies (Guest, 2009;Carter et al, 2010), we carry out fixed-effects regressions so as to control for possible unobserved organization-specific heterogeneities. We start our analysis with a fixed-effects regression model specified as follows: Table 4 reports fixed-effects regressions results of the impact of the various BDIV measures on Q.…”

Section: Multivariate Regression Analysessupporting

confidence: 64%

“…Some of the benefits that can be derived for using panel data include having both time-series and cross-sectional observations, more degrees of freedom and less multicollinearity among the variables (Gujarati, 2003;Wooldridge, 2010). Second, an investigation of five-year data with both cross-sectional and time-series properties may be useful in determining whether the observed cross-sectional relationship between board diversity and market valuation holds over-time (Carter et al, 2010;Ntim et al, 2012). This may help in drawing direct comparisons with the findings of previous studies (Rose, 2007;Francoeur et al, 2008;Robertson and Park, 2008).…”

Section: Sample and Datamentioning

confidence: 97%

“…In spite of this development, previous studies investigating the association between board diversity and market valuation are primarily concentrated in a small number of matured Western economies, such as US that depict comparatively similar institutional contexts (Gilbert and Stead, 1999;Carter et al, 2003;Catalyst, 2007;Adams and Ferreira, 2009;Carter et al, 2010). A further issue of concern is that existing studies that have been mainly conducted in developed countries have focused largely on the valuation implications of board diversity on the basis of gender (Shrader et al, 1997;Burges and Tharenou, 2002;Erhardt et al, 2003;Welbourne et al, 2007;Johnston and Malina, 2008;Dobbin and Jung, 2011;Lincoln and Adedoyin, 2012;Abdullah, 2013;Luckerath-Rovers, 2013).…”

Section: Introductionmentioning

confidence: 99%

“…Consistent with the conflicting nature of the theoretical literature on board diversity, previous evidence regarding the link between board diversity and market valuation is equally mixed (Zahra and Stanton, 1988;Wiersema and Bantel, 1992;Shrader et al, 1997;Carter et al, 2003Carter et al, , 2010Ujunwa, 2012;Dale-Olsen et al, 2013). One strand of the empirical literature reports that more diverse boards are associated with higher market valuation (Erhardt et al, 2003;Adams and Ferreira, 2009;Adler, 2010).…”

mentioning

confidence: 99%

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Board diversity and organizational valuation: unravelling the effects of ethnicity and gender

2013

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Organizational boards of directors are one of the most important subgroups within most modern organizations, performing critical advisory, monitoring and resource dependence roles. This paper investigates the crucial question of whether the stock market values ethnic and gender diversity within organizational boards. We find that board diversity is positively associated with market valuation. We distinctively demonstrate further that ethnic diversity is valued more highly by the stock market than gender diversity. By contrast, we do not find any evidence of a significant non-linear link between board diversity and market valuation. Our findings are robust across a number of econometric models that deal with different types of endogeneities and market valuation measures. Overall, our results are consistent with agency and resource dependence theoretical predictions.JEL classification: G30, G32, G34, G38

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Section: Dependent Independent and Control Variablessupporting

confidence: 84%

Section: Multivariate Regression Analysessupporting

confidence: 64%

Section: Sample and Datamentioning

confidence: 97%

Section: Introductionmentioning

confidence: 99%

mentioning

confidence: 99%

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Board diversity and organizational valuation: unravelling the effects of ethnicity and gender

2013

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The Impact of Board Gender Diversity Commitment on Firm Performance Moderated by Board Characteristics: Evidence From Sustainable European Firms and Financial Orientation

Bel‐Oms,

Grau‐Grau,

Núñez‐Almonte

2024

Bus Strat Dev

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The main goal of this study is to explore the moderating role of board gender diversity on the relationship between CEO duality, board size, board meetings, and firm performance in sustainable companies. This study examines the 120 most sustainable European firms listed in the EuroNext Vigeo Europe 120 Index from 2012 to 2021, with the findings showing that board gender diversity negatively moderates the relationship between CEO duality and firm performance, while positively moderating board meetings' impact. Furthermore, in banking‐oriented countries, board gender diversity positively moderates the relationship between board meetings and firm performance, while these effects are not significant in market‐oriented countries. The paper highlights that despite progress in increasing representation, mechanisms to ensure effective female participation in board decision‐making are required. This study is the first to examine how board gender diversity moderates the impact of board characteristics and CEO duality on sustainable firm performance in different financial orientations.

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The contribution of financial entities to the sustainable development through the reporting of corporate social responsibility information

Pucheta‐Martínez

Bel‐Oms

Nekhili

2018

Sustainable Development

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This paper aims at examining the relationship between the board composition and corporate social responsibility (CSR) of a sample of listed financial entities, discussing the reasons driving these entities to disclose CSR information. We hypothesise that there is a positive association between outside (institutional and independent directors) and female directors and CSR disclosure, and a negative relationship between inside directors and CSR reporting. Our findings provide evidence that the presence of independent directors and female directors on boards promotes CSR disclosure. Moreover, the results also show that the presence of inside directors and institutional directors on boards does not have an influence on CSR reporting.Thus, our evidence suggests that board attributes, such as the presence of independent and female directors, encourage financial entities to report CSR matters, showing the effectiveness of these two corporate governance mechanisms. The paper sheds light on the influence of the board structure of financial entities on CSR disclosure.Therefore, this study contributes to past research by providing an index for measuring the CSR disclosure of financial entities and the importance of the distinction between outside and inside directors.

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The Diversity of Corporate Board Committees and Firm Financial Performance

Cited by 70 publications

References 10 publications

Board diversity and organizational valuation: unravelling the effects of ethnicity and gender

Board diversity and organizational valuation: unravelling the effects of ethnicity and gender

The Impact of Board Gender Diversity Commitment on Firm Performance Moderated by Board Characteristics: Evidence From Sustainable European Firms and Financial Orientation

The contribution of financial entities to the sustainable development through the reporting of corporate social responsibility information

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