Killing two birds with one stone: gender diversity, information disclosures and financial distress

Kuldeep Singh and Akshita Arora

Social Responsibility Journal, 2024, vol. 21, issue 1, 112-132

Abstract: Purpose - The escalating instances of financial distress (FD) in corporate houses across the globe, call for immediate attention from policymakers, practitioners and academics equally. This study aims to examine how board gender diversity (GD) and information disclosures (ID) interact with each other to drive FD. Design/methodology/approach - The authors apply dynamic panel data analysis on a sample of 255 Indian-listed firms from 2016 to 2023 to arrive at the econometric results. Findings - The main findings indicate that while ID exacerbates distress, GD reduces it. In addition, GD also interacts with ID to curtail the adverse effects of disclosures on FD. Therefore, GD acts like a stone that kills two birds simultaneously, first by reducing the distress directly and second by limiting the negative effects of disclosures on distress. Originality/value - This study extends the understanding of the implications of GD and complements existing research by investigating its direct and indirect impact on FD. It builds on the analysis to propose that GD can foster resilience against adverse FD situations. The findings should apply to other emerging nations after careful consideration of country-specific factors.

Keywords: Board gender diversity; Information disclosures; Financial distress; Signalling theory; Social identity theory; Panel data (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eme:srjpps:srj-01-2024-0064

DOI: 10.1108/SRJ-01-2024-0064

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