Is the Nexus between Gender Diversity and Firm Financial Distress Moderated by CEO Duality?

Muhammad Tahir Khan (), Waqar Ahmad, Sajjad Nawaz Khan, Valentin Marian Antohi, Costinela Fortea and Monica Laura Zlati
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Muhammad Tahir Khan: Division of Management and Administrative Sciences, UE Business School, University of Education, Lahore 54770, Pakistan
Waqar Ahmad: School of Economics, International Islamic University Islamabad, Islamabad 44000, Pakistan
Sajjad Nawaz Khan: Department of Commerce, Accounting & Finance, Emerson University Multan, Multan 60000, Pakistan
Valentin Marian Antohi: Department of Business Administration, Dunarea de Jos University of Galati, 800008 Galati, Romania
Costinela Fortea: Department of Business Administration, Dunarea de Jos University of Galati, 800008 Galati, Romania
Monica Laura Zlati: Department of Business Administration, Dunarea de Jos University of Galati, 800008 Galati, Romania

Economies, 2024, vol. 12, issue 9, 1-17

Abstract: This study examines the impact of gender diversity in the positions of board commissioners, executive directors, and audit committee members on the financial performance of firms experiencing financial trouble. It also evaluates whether the presence of a CEO with multiple responsibilities moderates this relationship. The analysis encompassed 224 publicly traded companies from the non-financial sector, spanning the years 2012 to 2021. The study employed the dynamic panel model system GMM to address issues of endogeneity, simultaneity, and heterogeneity in the data. The findings indicate that the presence of women on supervisory boards and in senior positions has a substantial impact. Companies with a higher number of female board members have reduced financial hardship among Malaysian listed enterprises. Female directors exhibit a greater level of caution and risk aversion while participating in management choices, which is a significant conclusion. Research indicates that the majority of financial variables are inherently endogenous, so dynamic models are better suited for analyzing the interaction between these variables. This study also presents the notable correlation between gender diversity on boards of management, CEO duality, and financial difficulty.

Keywords: corporate governance; CEO duality; financial distress; gender diversity; financial performance; dynamic panel model (search for similar items in EconPapers)
JEL-codes: E F I J O Q (search for similar items in EconPapers)
Date: 2024
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