Representation of Women on Corporate Boards of Directors and Firm Financial Performance

Abstract

Abstract Purpose This chapter aims to evaluate the relationship between the representation of women on corporate boards of directors and its impact on firm financial performance. Design/Methodology/Approach This study utilized both a systematic review and a meta-analysis, using a sample of 40 published studies, which gleaned financial indicator and observation data from 28 different countries. Findings As indicated in previous studies, while positive, there was no significant correlation found between the number of women serving on the boards of directors and firm financial performance. Research Limitations/Implications The heterogeneity between the various studies analyzed may present difficulties in making general conclusions. The chapter could also be subject to publication bias, as the selection criteria included may indicate a need for further peer review. Future meta-analyses should include data associated with other financial indicators. Practical Implications This study shows how composition ratios of men/women serving on corporate boards should be addressed in terms of proving for a greater diversity of leadership perspectives. Originality/Value Previous systematic reviews and meta-analyses have analyzed country environments as moderators for the relationship between the representation of women on corporate boards and firm financial performance. The present study evaluates possible differences between the impact of the number of women serving on the board of directors on a variety of financial indicators (ROA, ROE, and Tobin’s Q).

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