Women in the Boardroom: How Do Female Directors of Corporate Boards Perceive Boardroom Dynamics?

Abstract

This study investigated how female directors of corporate boards of directors (BoD) experience boardroom dynamics. The study represents an initial research trend that moves from a unilateral focus on financial outcomes of female representation in BoDs toward stronger attention on the social dynamics in the boardroom. Drawing on social identity theory, the study proposed that female directors often constitute an out-group within the BoD, preventing them from experiencing positive board dynamics. More specifically, the study explored the extent to which female directors do experience less justice, lower cohesion, and higher levels of conflicts within the BoD than their male counterparts do. Moreover, we assumed that female directors with nontraditional educational backgrounds would be particularly likely to experience negative boardroom dynamics whereas female chairpersons of BoDs would perceive boardroom dynamics more positively than other female directors. The sample consisted of 491 directors from 149 BoDs. Our findings revealed that there were generally few differences in the way female and male directors experienced boardroom dynamics and female chairpersons of BoDs did not perceive the dynamics differently than other female directors. Female directors with nontraditional educational backgrounds perceived the boardroom dynamics somewhat more negatively than other female directors, but the differences were not statistically significant. The conclusions from this study are that there are reasons to believe that female directors are welcomed into boardrooms, not perceived as outgroups, and BoDs are able to benefit from the female directors' experience and skills.

Non-linear relationship between gender diversity in the partnership and profit performance in accounting firms

“…The main reason appears to be that a team with higher member homogeneity is more likely to cooperate and less prone to emotional conflicts (Earley and Mosakowski, 2000). Thus, members of a diverse group are more likely to experience a lack of cohesion, communication, and cooperation, which in turn heightens the potential for dissatisfaction and conflict (Shapcott, Carron, Burke, Bradshaw, and Estabrooks, 2006;Mathisen, Ogaard, and Marnburg, 2013). In such situations, the team requires more time and effort to reach a consensus.…”

Aid for Trade in Asia and the Pacific:

“…For instance, evidence from low-and middle-income countries suggests that gender-empowering initiatives such as promoting women in leadership and senior management bolsters revenue, efficiency, and productivity (Edwards 2017). Gender diversity in corporate boards has also proved to have incremental benefits on a broad range of outcomes, including better boardroom dynamics/effectiveness and overall financial performance (Adams and Ferreira 2009, Arena et al 2015, Mathisen et al 2013, Nielsen and Huse 2010. A study of firms with shares listed in Singapore found that greater gender diversity improved firm performance as measured by returns on assets and equity (Dieleman et al 2013).…”

Leveraging Trade for Women�s Economic Empowerment in the Pacific:

“…For instance, evidence from low-and middle-income countries suggests that gender-empowering initiatives such as promoting women in leadership and senior management positions bolstered revenue, efficiency, and productivity (Edwards 2017). Moreover, gender diversity in corporate boards and/or increasing the leadership of women executives prove to have incremental benefits on a broad range of corporate outcomes, including improved boardroom dynamics and effectiveness and overall firm financial performance (Adams and Ferreira 2009;Adusei and Yaa Takyiwah Obeng 2019;Arena et al 2015;Chandani, Mehta, and Chandrasekaran 2014;Mathisen, Ogaard, and Marnburg 2013;Mohan 2014;Nielsen and Huse 2010). Proactive policy support and affirmative measures to mainstream and upscale women's economic participation is vital not only to fully maximize their potential contributions but also to cultivate a vibrant private sector.…”