Factors Affecting the Presence of Women on Firms’ Board from an Institutional/Cultural Perspective

This paper is voted to study if cultural/institutional environment among different countries can affect the presence of women on boards. The analysis is focused on a statistical model to observe over the period 2007–2017 (11 years) a cross-sectional sample of MSCI Index-listed companies (476 firms). Grounding on Institutional Theory, we select several variables which represent cultural and institutional contexts in which firms do operate. As per female presence on boards, we collect data from Bloomberg database. To select institutional/cultural variables, we use well-acknowledged sources (Polity IV Project, PRS Group, World Bank). Our hypothesis is that among context variables, the most important one is the rule of law on gender quotas. To study the relationship between institutional factors and female presence on board, we use a multivariate regression model to test the effects on the female board presence to variables presenting cultural, legal, and institutional country’s context. In particular, we will perform a fixed effects regression, using also control variables selected from extant literature on this topic (i.e., financial and dimension variables). Our hypothesis is that among context variables, the most important one is the legislation on gender (a law which obliges the appointment of women by firms). Our first contribution is to show a descriptive analysis of the presence of female leaders in the sample. We want to provide a picture for the period of the MSCI Index firms’ situation regarding gender distribution among the sample boards. The second contribution is to test if the female presence is affected by the abovementioned cultural/institutional variables. Our work finally provides a new insight on analyzing the phenomenon of women on boards from a cultural/institutional point of view. We contribute to literature adopting a methodology that allows us to explain if the presence of women is depending on institutional and cultural factors. The empirical results of this study bring evidence that the presence of a law on gender quota in corporate board has a positive effect on the presence of women on boards. Moreover, the results show, in addition to coercive pressures, that there are also several normative pressures that have an influence on the representation of women on boards in a given country.