The valuation impact of gender quotas in the boardroom: Evidence from the European markets

Carlos Fernández-Méndez and Shams Pathan

Finance Research Letters, 2023, vol. 54, issue C

Abstract: We investigate stock market reactions to the announcement of the new, June 2022 European Union (EU) regulation on board gender diversity, which requires firms to appoint a minimum of 33% female directors (or 40% female non-executive directors). We find that the abnormal market returns surrounding the EU announcement are positive. We also note that the observed positive valuation effects are particularly strong for: (1) firms in countries with softer existing regulations on board gender diversity; and (2) firms with a larger gap between current levels of board gender diversity and the 33% gender quota. Our analysis of the EU legislation on gender quotas offers solid evidence that board gender quotas are perceived by investors as beneficial, particularly for firms exposed to a large gender imbalance.

Keywords: Women directors; Board gender diversity; Gender quota regulation (search for similar items in EconPapers)
JEL-codes: G32 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1544612323000739
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:54:y:2023:i:c:s1544612323000739

DOI: 10.1016/j.frl.2023.103699

Access Statistics for this article

Finance Research Letters is currently edited by R. Gençay

More articles in Finance Research Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().