Top executive gender, board gender diversity, and financing decisions: Evidence from debt structure choice

Datta, Sudip; Doan, Trang; Toscano, Francesca

doi:10.1016/j.jbankfin.2021.106070

Cited by 84 publications

(34 citation statements)

References 76 publications

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“…The dependent variable for all the hypotheses is the total amount of bank debt over total investments (Level of Bank Debt) (D'Amato, 2020; Datta et al, 2021;Zaid et al, 2020).…”

Section: Dependent Variablesmentioning

confidence: 99%

Men are from Mars, women are from Venus: on lenders’ stereotypical views and the implications for a firm’s debt

et al. 2022

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Building on social construction theory, this paper investigates how the presence of women on the board may affect access to credit because of lenders’ gender-stereotyped views. In our view this translates into different levels of the firm's bank debt. To evaluate the impact of gender as a social construct, we designed a within-country analysis in Italy by distinguishing between egalitarian and non-egalitarian contexts. To test our hypotheses, we used a sample of 3514 Italian listed and unlisted firms. Results showed a lower level of bank debt for firms with a relevant number of women in the boardroom (i.e., critical mass) if located in a non-egalitarian context. This effect was partially mitigated in firms during a crisis situation. While extant research explains gender-based differences in a firm’s financial structure by a change in inner-board mechanism/dynamics caused by differences in men/women characteristics, we argue that the social construction of gender may also induce lenders in different contexts to view boards with women differently in relation to access to credit.

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“…The dependent variable for all the hypotheses is the total amount of bank debt over total investments (Level of Bank Debt) (D'Amato, 2020; Datta et al, 2021;Zaid et al, 2020).…”

Section: Dependent Variablesmentioning

confidence: 99%

Men are from Mars, women are from Venus: on lenders’ stereotypical views and the implications for a firm’s debt

et al. 2022

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“…Homogenous boards (Traditionally males), managers made risky investments through massive borrowings due to their overconfidence and poor monitoring system. In contrast, the literature suggests that female participation in the board tightens monitoring and improves financial decisions (Fields et al, 2012 ; Datta et al, 2021 ). This monitoring ability is perceived as women's risk averseness.…”

Section: Review Of Literaturementioning

confidence: 99%

Diversity in boardroom and debt financing: A case from China

Sun¹,

Ahmad²,

Tahir³

et al. 2022

Front. Psychol.

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The study aims to explore the role of gender diversity in debt financing choices among Chinese listed firms. The study used the Chinese listed firm's data from 1991 to 2022 from the Chinese Stock Market return. The study used the fixed effect regression analysis and revealed that gender diversity positively affects debt financing among Chinese firms. Additionally, mass theory results suggested that at least three females on the board significantly influence firms. It served as the voice of gender diversity to influence the board's decisions regarding debt financing. The study has several theoretical and practical implications. This study will enlighten the Chinese boardroom dynamics by reassuring them to add more females to diversity policies. It will benefit future studies on boardroom activities and debt financing in emerging economies. It will be practical guidance for the Chinese policymakers, governing authorities, and corporate executives. The study stresses the need for significant diversity on the board rather than one female presence on the board. Secondly, this study contradicts the stereotype perception that females are not making risky decisions.

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“…Prior studies have consistently articulated that 1) female executives rely more on information, data and relevant analysis in their decision-making process; 2) female executives' less optimistic management style entails them being more cautious, risk-averse and conservative in their decision-making; 3) ceteris paribus, female executives prefer to rely on established banking relationships and secure loans to fund projects and for investments thoroughly evaluated to contribute net-positive returns and improve their firm's growth trends; and 4) female executives appear to favour lower leveraged capital structures and are not fixated on achieving optimal capital structure (see Bellucci et al, 2010;Maurice et al, 2013;Mara et al, 2016;Adusei & Obeng, 2019;Đang et al, 2020;Schopohl et al, 2020;Benkraiem et al, 2021;Sudip et al, 2021). The present study found that gender (as a component of demographic attributes) is a key determinant of capital structure.…”

Section: Gendermentioning

confidence: 99%

Causative dynamics of overconfidence, optimism, framing effects and demographic attributes as capital structure determinants for publicly listed firms in Indonesia

Lim¹,

Supratikno²,

Ugut³

et al. 2022

10.5267/j.ac

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This study examines whether capital structure determinations by Indonesian publicly listed firms (Tbks) are influenced by the behavioural biases of overconfidence and optimism, with the underlying rationality frameworks being framed by relevant financial information and impacted by decision-makers’ demographic attributes. Data were obtained from survey respondents and statistically analysed using partial least squares structural equation modelling to identify the indicators of causative dynamics within the hypothesised relationships. Sampled Tbks’ management (CEOs/CFOs) displayed the inherent behavioural traits of overconfidence and optimism in their capital structure determinations. However, such behavioural variables were not statistically proven to significantly influence capital structure decision-making and, hence, were not validated as capital structure determinants. The pecking order framework was revealed to have a significant framing effect on capital structure decision-making by sampled managers. Sampled managers’ demographic attributes and backgrounds were found to be capital structure determinants but did not have a mediating or moderating influence on the modelled relationship between behavioural variables and capital structure.

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Top executive gender, board gender diversity, and financing decisions: Evidence from debt structure choice

Cited by 84 publications

References 76 publications

Men are from Mars, women are from Venus: on lenders’ stereotypical views and the implications for a firm’s debt

Men are from Mars, women are from Venus: on lenders’ stereotypical views and the implications for a firm’s debt

Diversity in boardroom and debt financing: A case from China

Causative dynamics of overconfidence, optimism, framing effects and demographic attributes as capital structure determinants for publicly listed firms in Indonesia

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