Gender Diversity on Corporate Boards: Do Women Contribute Unique Skills?
American Economic Review · 2016 · Volume 106 · Issue 5
Abstract
We show that gender diversity in corporate boards could improve firm value because of the contributions that women make to the board. Prior studies examine valuation effects of gender-diverse boards and reach mixed conclusions. To help resolve this conundrum, we consider how gender diversity could affect firm value, that is, what mechanisms could explain how female directors benefit corporate board performance. We hypothesize and provide evidence that women directors contribute to boards by offering specific functional expertise, often missing from corporate boards. The additional expertise increases board heterogeneity which Kim and Starks (2015) show can increase firm value.
Keywords
Financing Policy, Financial Risk and Risk Management, Capital and Ownership Structure, Value of Firms, Goodwill, Mergers, Acquisitions, Restructuring, Voting, Proxy Contests, Corporate Governance, Economics of Gender, Non-labor Discrimination, Firm Performance: Size, Diversification, and Scope
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