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Women on Boards and Financial Performance: Evidence from a European Emerging Market

Mihaela Ionascu (), Ion Ionascu (), Marian Sacarin () and Mihaela Minu ()
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Mihaela Ionascu: Department of Accounting and Audit, Bucharest University of Economic Studies, Piata Romana 6, 010374 Bucuresti, Romania
Ion Ionascu: Department of Accounting and Audit, Bucharest University of Economic Studies, Piata Romana 6, 010374 Bucuresti, Romania
Marian Sacarin: Department of Accounting and Audit, Bucharest University of Economic Studies, Piata Romana 6, 010374 Bucuresti, Romania
Mihaela Minu: Department of Accounting and Audit, Bucharest University of Economic Studies, Piata Romana 6, 010374 Bucuresti, Romania

Sustainability, 2018, vol. 10, issue 5, 1-18

Abstract: This paper examines the association between gender diversity on corporate boards and firm performance for a European emerging market, which lags behind in terms of both corporate governance quality and social cohesion indicators. In a sample of Romanian companies listed on BSE (Bucharest Stock Exchange) during 2012–2016, this study confirms previous concerns related to the endogeneity of gender diversity variables in firm performance regression analysis and shows that, on average, diversity has no significant impact on firm-performance. However, based on a sub-sample analysis, results show a robust association in the case of profit-firms and those listed on the Standard tier. As losses can be construed as a distortion factor and Standard tier companies are the smallest and less well governed on the market, the results could be taken to suggest that Romanian listed companies do benefit from increasing gender diversity in the boardrooms, which could complement their rather poor corporate governance practices. Overall, the paper concludes that, in the context of an emerging market, policies aimed at increasing gender diversity in the boards appear to be financially viable and even beneficial for the major part of listed companies, balancing successfully the social cohesion and economic components of sustainable development.

Keywords: gender; diversity; board of directors; financial performance; emerging markets; sustainable development (search for similar items in EconPapers)
JEL-codes: Q Q0 Q2 Q3 Q5 Q56 O13 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:10:y:2018:i:5:p:1644-:d:147973

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