Abstract
A number of studies have found little economic impact of board gender diversity on firm performance. We return to this issue in the context of large European firms. Our contribution is twofold. First, using information on the gender of CEOs children as a source of exogenous variation in female director appointments, we demonstrate a robust positive effect of female board representation on firm performance. Second, while previous work has considered female representation broadly, we focus on membership of board committees as a proxy for active involvement in corporate governance. We demonstrate economically meaningful positive effects on performance of female representation on board committees. Our evidence is supportive of an economic rationale for increased female representation on corporate boards. Key Words: Gender, Diversity, Firm Performance, Board Committees JEL Codes: G30, G34, J16 Acknowledgement: We thank the editor and two anonymous referees for their comments. We also thank Renne Adams, Swarnava Biswas, Patricia Boyallian, Daniel Ferreira, Sudipto Dasgupta, Paolo Fulghieri, Ian Gregory-Smith, John Heywood, Vikram Nanda, Amiyatosh Purnanandam, and Ian Walker for their suggestions on previous versions of this paper. We are grateful for comments from the participants at Lancaster University Economics seminar series, The Geary Institute-UCD, RWI-Essen, University of Wisconsin- Milwaukee, NTNU, Queen Mary University of London, 5th Annual Corporate Finance Conference, Royal Economic Society Annual Conference 2016, Work, Pension and Employment Group Annual Conference, 2015. Research assistance from Rhys Wheeler and Molly Rose Ives, and financial assistance from Lancaster University pump priming grant are gratefully acknowledged.
