Does female management influence firm performance? Evidence from Luxembourg banks

Regina M. Reinert (), Florian Weigert () and Christoph H. Winnefeld ()
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Regina M. Reinert: University of St.Gallen and Hogrefe Consulting
Florian Weigert: University of St. Gallen
Christoph H. Winnefeld: Commission de Surveillance Du Secteur Financier and Trier University of Applied Sciences

Financial Markets and Portfolio Management, 2016, vol. 30, issue 2, No 1, 113-136

Abstract: Abstract In this study, we examine the relationship between the proportion of women in top management positions at banks and these institutions’ financial performance. Using prudential data from supervisory reporting for all credit institutions in the Grand Duchy of Luxembourg from 1999 to 2013, we find a positive association between female management and firm performance. The economic effect is substantial: a 10 % increase in women in top management positions improves the bank’s future return on equity by more than 3 % p.a. Moreover, we show that this positive relationship is (i) almost twice as large during the global financial crisis than in stable market conditions and (ii) non-linear, with banks having 20–40 % female management being the most successful.

Keywords: Management diversity; Female management; Bank performance (search for similar items in EconPapers)
JEL-codes: G21 J16 L25 M14 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (6)

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DOI: 10.1007/s11408-016-0266-8

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