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Does Female Leadership Boost Firm Profitability?

Author

Listed:
  • Kotiranta, Annu
  • Kovalainen, Anne
  • Rouvinen, Petri

Abstract

Less than a tenth of Finnish firms CEOs and chairmen of the board are women; less than a fourth of Finnish firms board members are women. An empirical regression analysis of a large firm-level data set suggests that a company led by a women CEO is on average about ten per cent more profitable than a corresponding company led by a man, even after taking into account a number other factors (such as firm size and industry) possibly affecting profitability. The share of woman board members also has a similar impact. The effect of the chairmans gender is statistically insignificant. These findings are partial correlations; due to data limitations neither causality nor underlying factors are studied

Suggested Citation

  • Kotiranta, Annu & Kovalainen, Anne & Rouvinen, Petri, 2007. "Does Female Leadership Boost Firm Profitability?," Discussion Papers 1110, The Research Institute of the Finnish Economy.
    • Handle: RePEc:rif:dpaper:1110
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    File URL: http://www.etla.fi/wp-content/uploads/2012/09/dp1110.pdf
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    Cited by:

    1. Lai Van Vo & Hazel Thu‐Hien Nguyen & Huong Thi Thu Le, 2021. "Do female CEOs make a difference in firm operations? Evidence from Vietnam," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 61(S1), pages 1489-1516, April.
    2. Deogratias Bugandwa Mungu Akonkwa & Elie Lunanga & Joseph Bahati Mukulu & Toussaint Ciza Bugandwa & Elizabeth Furaha Mwaza, 2022. "Leadership Styles and Small Enterprises’ Performance: Is Gender an Issue? Empirical Study from Democratic Republic of Congo," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 8(1), pages 60-82, January.
    3. Simon Ho & Annie Li & Kinsun Tam & Feida Zhang, 2015. "CEO Gender, Ethical Leadership, and Accounting Conservatism," Journal of Business Ethics, Springer, vol. 127(2), pages 351-370, March.

    More about this item

    Keywords

    gender; equality; discrimination; firm; profitability; corporate governance;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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