 IPO price formation and board gender diversityRaghavendra Rau, Jason Sandvik and Theo Vermaelen Journal of Corporate Finance, 2024, vol. 88, issue C Abstract: Using a sample of U.S. IPOs from 2000–2019, we show that IPOs with at least one female director experience significantly greater underpricing on the first trading day. The effect is not attributable to the previously documented determinants of underpricing or other firm or director characteristics. The underpricing effect is the strongest after 2010—when pressures were placed on firms to diversify their boards—and the effect is mitigated in the very last years of the sample—where we find that gender-diverse board IPOs realize greater offer price revisions and final offer prices, relative to non-diverse board IPOs. The dynamic relation between board gender diversity and IPO price formation coincides with the timing of the diversity campaigns of BlackRock, State Street, and Vanguard, suggesting that investor demand for board gender diversity was not fully incorporated into IPO offer prices until this demand was widely publicized. Keywords: Initial public offerings; Going public process; Board gender diversity; Underpricing; Investment banks; Corporate governance (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:88:y:2024:i:c:s0929119924000919 DOI: 10.1016/j.jcorpfin.2024.102629 Access Statistics for this article Journal of Corporate Finance is currently edited by A. Poulsen and J. Netter More articles in Journal of Corporate Finance from Elsevier |
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