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Gender diversity and financial performance in an emerging economy: empirical evidencefrom India

Gender diversity and financial performance in an emerging economy: empirical evidencefrom India This paper aims to examine the impact of gender diversity both at operational and leadership levels on the financial performance of firms in India.Design/methodology/approachThe study is based on a panel data set of 100 large Indian corporate firms. This study uses the Blau index and Shannon index to compute gender diversity. First, this paper uses system generalized method of moments model to deal with the potential endogeneity issue in the association between gender diversity and firm performance. Second, to unveil heterogeneity in such a relationship, the study applies panel data quantile regression model. Finally, the study adopts a generalized estimating equation model to investigate such relationships for group affiliated and standalone firms.FindingsThis study finds a significant positive impact of workforce gender diversity and board gender diversity on the financial performance of firms. Further, the results of the quantile regression model indicate that the impact of gender diversity (workforce and board) on firm performance is more pronounced at higher quantiles of the conditional distribution of firm performance. However, the study fails to extricate any significant impact of audit committee gender diversity on firm performance. Finally, the study also finds a significant positive impact of gender diversity at both workforce and board level for a group affiliated, as well as standalone firms.Originality/valueThe present study makes a novel contribution to the extant literature on the association between gender diversity and financial performance of firms by examining such diversity at both operational and leadership levels in the context of an emerging country such as India that captures the complex realities pertaining to gender issues. Further, the study contributes to the empirical literature regarding the heterogeneous impact of gender diversity on firm performance in the Indian context. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Management Research Review Emerald Publishing

Gender diversity and financial performance in an emerging economy: empirical evidencefrom India

Management Research Review , Volume 44 (12): 24 – Nov 30, 2021

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References (92)

Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2040-8269
DOI
10.1108/mrr-08-2020-0525
Publisher site
See Article on Publisher Site

Abstract

This paper aims to examine the impact of gender diversity both at operational and leadership levels on the financial performance of firms in India.Design/methodology/approachThe study is based on a panel data set of 100 large Indian corporate firms. This study uses the Blau index and Shannon index to compute gender diversity. First, this paper uses system generalized method of moments model to deal with the potential endogeneity issue in the association between gender diversity and firm performance. Second, to unveil heterogeneity in such a relationship, the study applies panel data quantile regression model. Finally, the study adopts a generalized estimating equation model to investigate such relationships for group affiliated and standalone firms.FindingsThis study finds a significant positive impact of workforce gender diversity and board gender diversity on the financial performance of firms. Further, the results of the quantile regression model indicate that the impact of gender diversity (workforce and board) on firm performance is more pronounced at higher quantiles of the conditional distribution of firm performance. However, the study fails to extricate any significant impact of audit committee gender diversity on firm performance. Finally, the study also finds a significant positive impact of gender diversity at both workforce and board level for a group affiliated, as well as standalone firms.Originality/valueThe present study makes a novel contribution to the extant literature on the association between gender diversity and financial performance of firms by examining such diversity at both operational and leadership levels in the context of an emerging country such as India that captures the complex realities pertaining to gender issues. Further, the study contributes to the empirical literature regarding the heterogeneous impact of gender diversity on firm performance in the Indian context.

Journal

Management Research ReviewEmerald Publishing

Published: Nov 30, 2021

Keywords: Firm performance; Corporate governance; Board gender diversity; Audit committee gender diversity; System GMM model; Quantile regression model; Workforce gender diversity; G30; G34; J16

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