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Board Level Gender Diversity and Firm Financial Performance-Evidence from India


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1 Banaras Hindu University, Varanasi, Uttar Pradesh, India
     

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The present study investigates the effect of gender diversity on firm performance of Indian companies and whether higher proportion of independent women directors significantly and positively moderates the effect of gender diversity on firm performance. The study has been conducted on BSE 100 companies for a period of 9 years. Firm performance has been measured by two accounting measures viz. ROA and ROCE. Gender diversity has been measured by Blau's index and as proportion of women directors on board. Various other control variables viz. age, CEO duality, leverage, size, etc. have been used. Panel data regression analysis on the data reveals that gender diversity positively but insignificantly affects firm performance of Indian companies. Firms having higher proportion of independent women directors as compared to non-independent women directors earn higher returns. Higher proportion of independent women directors positively moderates the effect of gender diversity on firm performance, though the moderation is not significant.


Keywords

Corporate Governance, Gender Diversity, Women Directors, Independent Women Directors, Firm Performance.
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  • Board Level Gender Diversity and Firm Financial Performance-Evidence from India

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Authors

Manjula Shukla
Banaras Hindu University, Varanasi, Uttar Pradesh, India

Abstract


The present study investigates the effect of gender diversity on firm performance of Indian companies and whether higher proportion of independent women directors significantly and positively moderates the effect of gender diversity on firm performance. The study has been conducted on BSE 100 companies for a period of 9 years. Firm performance has been measured by two accounting measures viz. ROA and ROCE. Gender diversity has been measured by Blau's index and as proportion of women directors on board. Various other control variables viz. age, CEO duality, leverage, size, etc. have been used. Panel data regression analysis on the data reveals that gender diversity positively but insignificantly affects firm performance of Indian companies. Firms having higher proportion of independent women directors as compared to non-independent women directors earn higher returns. Higher proportion of independent women directors positively moderates the effect of gender diversity on firm performance, though the moderation is not significant.


Keywords


Corporate Governance, Gender Diversity, Women Directors, Independent Women Directors, Firm Performance.

References