Does corporate board gender diversity influence shareholder value? A case of the non-financial sector in an emerging economy

This study investigates the influence of board gender diversity on the shareholder value of South African-listed non-financial companies on the JSE from 2013 to 2022. The study used a quantitative quasi-experimental method to examine the influence of board gender diversity on shareholder value creation measures from a multi-theoretical perspective. The board gender diversity measures include the proportion of women directors on the board, the Blau index for board gender diversity, and dummy variables indicating the presence of one, two, three, or more women directors on the board, as well as skewed board, tilted board, and balanced board. Shareholder value creation is proxied using standardised market value added, market-to-book ratio, and Tobin’s Q. The study utilises fixed effects models based on linear and curvilinear models to test the hypotheses. According to linear models, all board gender diversity measures demonstrate a significant positive, negative, or no effect on shareholder value creation measures, aligning with the multi-theoretical perspective of corporate governance research. However, curvilinear quadratic models suggest that the Blau index for board gender diversity and the proportion of women directors on board positively and negatively affect shareholder value creation, highlighting an inverted U-shaped effect. The results recognise the "too much- of- a -good- thing†effect and a possible optimal(or worse) level of board gender diversity as crucial. In conclusion, this study demonstrates that the claim of the ‘‘one size fits all’’ board gender diversity mechanism in creating and maximising shareholder value, often implicitly stated by regulators and advisors, may be misleading.