Gender Diversity in the Boardroom and Firm Performance: What Exactly Constitutes a “Critical Mass?”

Jasmin Joecks, Kerstin Pull and Karin Vetter

Journal of Business Ethics, 2013, vol. 118, issue 1, 72 pages

Abstract: The under-representation of women on boards is a heavily discussed topic—not only in Germany. Based on critical mass theory and with the help of a hand-collected panel dataset of 151 listed German firms for the years 2000–2005, we explore whether the link between gender diversity and firm performance follows a U-shape. Controlling for reversed causality, we find evidence for gender diversity to at first negatively affect firm performance and—only after a “critical mass” of about 30 % women has been reached—to be associated with higher firm performance than completely male boards. Given our sample firms, the critical mass of 30 % women translates into an absolute number of about three women on the board and hence supports recent studies on a corresponding “magic number” of women in the boardroom. Copyright Springer Science+Business Media Dordrecht 2013

Keywords: Diversity; Gender; Supervisory board; Performance; G30; J16 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (223)

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Persistent link: https://EconPapers.repec.org/RePEc:kap:jbuset:v:118:y:2013:i:1:p:61-72

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DOI: 10.1007/s10551-012-1553-6

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