Gender Diversity and Corporate Governance

More than two decades after the United Nations’ Beijing Declaration and Platform for Action pledged to take the necessary steps to remove all hindrances to gender equality and the empowerment of women and LGBTQIA+, support for gender equality is lacking effective action to boost women’s representation at the tables of power. But the slow progress seen in closing the gender gap. According to the recent Global Gender Gap Report (2021), it will take another 135.6 years to close the gender gap based on the current rate of progress. In addition, the covid-19 pandemic and economic crisis has raised new barriers to building inclusive and prosperous economies and societies. In response to the gender diversity challenge, a wide range of initiatives and solutions have been proposed. Several countries have legislated boardroom gender quotas and propose policies requiring board composition disclosure (Terjesen et al., 2015).

Despite the social pressure on gender equality, a diverse range of academic literature does not explicitly develop a theoretical framework explaining the gender gap in leadership. At the individual level, gender stereotyping fosters bias against women in managerial selection, placement, and promotion, and training decisions (Schein, 2007). Traditionally, the most appreciated leaders possess characteristics commonly associated with masculinity, such as competitiveness, self-confidence, ambition and aggressiveness (for example, see Koenig et al., 2011; Schein, 1973). Yet, researchers have shown that many masculine traits did not always benefit the companies. Some researchers argue that female leaders have important traits, such as warmth and empathy that are useful during a crisis. Female executives lead differently than male executives (for example, see Gipson et al., 2017; Kirsch, 2018; Terjesen et al., 2009). They tend to be collaborative and enhance participative decision making (for example, see (Bart & McQueen, 2013; Mano-Negrin & Sheaffer, 2004)). At the same time, it is also argued that female executives behave like men in order to succeed. thailand university ranking

At the board level, a voluminous body of literature suggests that board gender diversity brings unique perspectives to the boardroom (For example, see Arfken et al., 2004; Van Der Walt et al., 2006). If a diversified board can bring a broader range of backgrounds among directors, then a more diversified board will collectively possess more information and will have a higher chance of making better decisions. In addition, the diversity of the board can enhance the board independence, consequently increased board diversity could lead to a better board monitoring function (for example, see Adams & Ferreira, 2009; Gul et al., 2011; Konrad et al., 2008; Papangkorn et al., 2019; Srinidhi et al., 2011; Terjesen et al., 2009). At the same time, board gender diversity also gives a positive signal to stakeholders that the company cares about the societal diversity in their governance (for example, see Bernardi et al., 2006; Daily & Dalton, 2003; Martin et al., 2008). On the other hand, a diverse board may cause higher decision-making costs in boards, and increase the likelihood of conflicts and friction in boards(Adams & Ferreira, 2009).