Board gender diversity and US corporate bonds

Renee M. Oyotode-Adebile and Zubair Ali Raja

International Journal of Managerial Finance, 2019, vol. 15, issue 5, 771-791

Abstract: Purpose - The purpose of this paper is to examine the impact of board gender diversity on bond terms and bondholders’ returns. Design/methodology/approach - The authors perform pooled OLS regression, simultaneous regressions and propensity score matching to a panel data set of bond data for 319 US firms from 2007 to 2014. Findings - The authors find that firms with gender-diverse boards have lower yields, higher ratings, larger issue size and shorter maturity. They also find that bondholders require fewer returns from firms with gender-diverse boards. However, the effect is more pronounced when women, constitutes at least 29.67 percent of the board. Originality/value - This analysis supplements the findings that board gender diversity is essential for bondholders. It shows that bondholders should look at board gender diversity as a criterion to invest because bonds issued by firms with gender-diverse board have less risk. For practitioners, this study shows that more women participation on boards leads to a reduction in borrowing costs.

Keywords: Propensity score matching; Board gender diversity; Corporate debt (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijmfpp:ijmf-10-2018-0290

DOI: 10.1108/IJMF-10-2018-0290

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