Women in power with power: The influence of meaningful board representation on default risk

Isabel Abinzano, Beatriz Martinez and Jannine Poletti-Hughes

International Review of Financial Analysis, 2023, vol. 89, issue C

Abstract: This paper examines the relationship between the presence of female board members and firms' corporate default risk. We find an inverted “U-shaped” relationship for a sample of 917 firms in 19 emerging markets for the period 2005–2019. We also show that, consistent with critical mass theory, boards need to have three or more female directors to significantly reduce default risk. Furthermore, having female directors with an independent role on the board in countries with less familial dominance, or having female directors with a leadership position, significantly reduces default risk. Finally, we find a positive effect of the interaction between a country's gender inequality and board gender diversity on default risk.

Keywords: Black-Scholes-Merton model; Critical mass; Default risk; Female directors (search for similar items in EconPapers)
JEL-codes: G30 G32 G33 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1057521923002879
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:finana:v:89:y:2023:i:c:s1057521923002879

DOI: 10.1016/j.irfa.2023.102771

Access Statistics for this article

International Review of Financial Analysis is currently edited by B.M. Lucey

More articles in International Review of Financial Analysis from Elsevier
Bibliographic data for series maintained by Catherine Liu ().