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Critical mass and voice: Board gender diversity and financial reporting quality

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  • Dobija, Dorota
  • Hryckiewicz, Aneta
  • Zaman, Mahbub
  • Puławska, Karolina

Abstract

Based on the notion that a diverse board takes a more balanced perspective and pays greater attention to financial reporting oversight, this paper examines the association between board gender diversity and financial reporting quality. Specifically, we study the enablers that allow women to add value to the monitoring activities in the context of limited affirmative actions to promote women on boards. We provide evidence that increased share of women on boards is associated with improved financial reporting quality proxied by reporting timeliness, earnings management, and auditor opinions. We find that in companies that do not have a sufficient number of women on boards, the critical mass effect can be replaced by the “voice” effect, i.e., it is still possible to improve financial reporting quality by having a woman chair the board.

Suggested Citation

  • Dobija, Dorota & Hryckiewicz, Aneta & Zaman, Mahbub & Puławska, Karolina, 2022. "Critical mass and voice: Board gender diversity and financial reporting quality," European Management Journal, Elsevier, vol. 40(1), pages 29-44.
    • Handle: RePEc:eee:eurman:v:40:y:2022:i:1:p:29-44
    DOI: 10.1016/j.emj.2021.02.005
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    Cited by:

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    2. Amir Allam & Tantawy Moussa & Mahmoud Elmarzouky, 2024. "Examining the relationship between CEO power and modern slavery disclosures: The moderating role of board gender diversity in UK companies," Business Strategy and the Environment, Wiley Blackwell, vol. 33(8), pages 8067-8085, December.
    3. Pei Chu & Mohamed Elsayed & Yousry Ahmed, 2025. "Do women in the boardroom influence foreign acquisitions' premium and outcomes? Evidence from China," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 30(2), pages 1163-1189, April.
    4. Garcia-Blandon, Josep & Josep Maria, Argilés-Bosch & Diego, Ravenda, 2024. "Female directors and the firm's cost of debt: Evidence from a quasi-natural experiment," European Management Journal, Elsevier, vol. 42(2), pages 224-232.
    5. Sperber, Sonja & Täuber, Susanne & Post, Corinne & Barzantny, Cordula, 2023. "Gender Data Gap and its impact on management science — Reflections from a European perspective," European Management Journal, Elsevier, vol. 41(1), pages 2-8.

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    More about this item

    Keywords

    Corporate governance; Critical mass; Voice; Women; Diversity; Supervisory board;
    All these keywords.

    JEL classification:

    • M19 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Other
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing

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