Women directors, firm performance, and firm risk: A causal perspective
Journal article, Peer reviewed
Published version
Permanent lenke
http://hdl.handle.net/11250/2638008Utgivelsesdato
2019Metadata
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- Articles (SOL) [143]
- Publikasjoner fra CRIStin (NHH) [249]
Originalversjon
10.1016/j.leaqua.2019.05.004Sammendrag
Norway was the first of ten countries to legislate gender quotas for boards of publicly traded firms. There is
considerable debate and mixed evidence concerning the implications of female board representation. In this
paper, we explain the main sources of biases in the existing literature on the effects of women directors on firm
performance and review methods to account for these biases. We address the endogeneity problem by using a
difference-in-differences approach to study the effects of women directors on firm performance with specific
consideration of the common trend assumption, and we explicitly distinguish between accounting-based (i.e.,
operating income divided by assets, return on assets) and market-based (i.e., market-to-book ratio and Tobin's Q)
performance measures in the Norwegian setting. The control group are firms from Finland, Sweden, and
Denmark. We further extend the analysis of causal effects of women directors to firm risk. Our results imply a
negative effect of mandated female representation on firm performance and on firm risk