Does board gender diversity improve the informativeness of stock prices

By Ferdinand A. Gul, Bin Srinidhi, A. C. Ng. 2011

1,433 citations recorded by the source corpus.

We show that stock prices of firms with gender-diverse boards reflect more firm-specific information after controlling for corporate governance, earnings quality, institutional ownership and acquisition activity. Further, we show that the relationship is stronger for firms with weak corporate governance suggesting that gender-diverse boards could act as a substitute mechanism for corporate governance that would be otherwise weak. The results are robust to alternative specifications of informativeness and gender diversity and to sensitivity tests controlling for time-invariant firm characteristics and alternative measures of stock price informativeness. We also find that gender diversity improves stock price informativeness through the mechanism of increased public disclosure in large firms and by encouraging private information collection in small firms.

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Citations in the corpus

Gender diversity and bank misconduct (2021, background): “With reference to agency theory, there is evidence that increased gender diversity in the boardroom can positively influence corporate outcomes in relation to key board functions, such as attendance, quality of discussions, and monitoring effectiveness including a better oversight of firm’s disclosu”
Women directors, family ownership and earnings management in Malaysia (2016, background): “Therefore, the presence of female directors changes the board’s behaviours and their ability to detect earnings management because of women’s leadership style, which requires more informed and extensive discussion of issues (Gul et al., 2011; Srinidhi et al., 2011).”
Independent Director Reputation Incentives and Stock Price Informativeness (2017, methodology): “Following prior literature (e.g. Gul et al., 2011; Carter and Soo, 1999), we examine Form 8-”
Board Gender Diversity and Corporate Response to Sustainability Initiatives: Evidence from the Carbon Disclosure Project (2015, background): “This may lead to improved board effectiveness as a result of the improved quality of board deliberations and better supervision of the firm’s disclosures (Gul et al. 2011).”
Professors in the Boardroom and Their Impact on Corporate Governance and Firm Performance: Professors in the Boardroom (2014, background): “For example, some studies find that there is no significant association between board independence and firm performance (Baysinger and Butler, 1985; Hermalin and Weisbach, 1991; Mehran, 1995; Bhagat and Black, 2001), while others find that board independence is negatively related to firm…”
The Monitoring Role of Female Directors Over Accounting Quality (2017, unknown): “Consistent but indirect evidence is presented also by studies that systematically report the unexpectedly high number of firms with either no females or with a single female on their boards (see, e.g., Srinidhi et al., 2011; Gul et al., 2011).”
Gender Differences in Financial Reporting Decision-Making: Evidence from Accounting Conservatism (2015, unknown): “Recent studies find that gender diversity in top management and boardroom positively affects earnings quality, we therefore expect both management gender diversity and board gender diversity to positively impact conservatism (e.g., Krishnan and Parsons 2008; Labelle et al. 2010; Gul et al. 2011).”
Does board gender diversity affect corporate cash holdings? (2019, unknown): “…corporate governance mechanisms and are associated with higher dividend payouts (Chen, Leung, & Goergen, 2017), higher stock price informativeness (Gul et al., 2011), more audit efforts to ensure accountability (Gul, Srinidhi, & Tsui, 2008), and perform monitoring functions more diligently (Adams…”
Beyond gender diversity: How specific attributes of female directors affect earnings management (2017, background): “The role of the board of directors and of board characteristics (i.e. board independence and gender diversity) is usually associated with the protection of shareholder interests (Gul et al., 2011; Kim, Kitsabunnarat-Chatjuthamard, & Nofsinger, 2007; Liu & Lu, 2007; Nekhili & Gatfaoui; 2013).”