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Do female directors mitigate asymmetric cost behavior? Evidence from international data

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  • Le, Anh-Tuan
  • Tran, Thao Phuong
  • Cheng, Tzu-Chang Forrest

Abstract

Using an international sample of firms across 37 countries from 1999 to 2018, we find that firms with more gender diversity exhibit lower cost stickiness. The results are robust for alternative measures of variables and after addressing endogeneity issues through a two-stage least squares estimation. Furthermore, the impact of board gender diversity on firm cost stickiness is more pronounced in firms that have higher agency costs, lower corporate governance, higher risk-taking, and non-overconfident managers. Overall, our findings contribute to the extant literature by offering evidence of the role female directors play in minimizing agency problems and reducing asymmetric cost behavior.

Suggested Citation

  • Le, Anh-Tuan & Tran, Thao Phuong & Cheng, Tzu-Chang Forrest, 2022. "Do female directors mitigate asymmetric cost behavior? Evidence from international data," Finance Research Letters, Elsevier, vol. 49(C).
    • Handle: RePEc:eee:finlet:v:49:y:2022:i:c:s1544612322003452
    DOI: 10.1016/j.frl.2022.103121
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    Cited by:

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    More about this item

    Keywords

    Board gender diversity; Cost stickiness; Female directors;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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