IDEAS home Printed from https://ideas.repec.org/a/oap/ijossp/v11y2022i2p80-92id643.html
   My bibliography  Save this article

Can Female Directors Improve Performance Consequences of Executives’ External Pay Gap? Evidence from China

Author

Listed:
  • Zhang Changzheng
  • Wang Zhenghao

Abstract

Drawing on the perspectives of the tournament theory and critical mass theory, the paper investigates the moderating mechanism of female directors’ participation in the board on the relationship between executives’ external pay gap (EEPG) and firm performance. An unbalanced panel data consisting of 21082 firm-year observations from 2783 non-financial listed companies in Shanghai and Shenzhen Stock Exchange of China from 2008 to 2018 is selected as the research sample, and multiple regression analysis, robustness test and endogenous test are taken as the statistical methods. Theoretical analysis and empirical data conclude that EEPG has an inverted U-shaped impact on firm performance, and a mass level of female directors, i.e., exceeding 1/3 in proportion or 3 in number, would change the curve relationship into a positive linear one by enhancing the positive effects and constraining the negative effects of larger EEPG. The paper adds new knowledge to the literature on consequences of female directors and antecedents of firm performance, specifically by providing a comprehensive understanding how and why female directors improve EEPG’s performance consequences.

Suggested Citation

  • Zhang Changzheng & Wang Zhenghao, 2022. "Can Female Directors Improve Performance Consequences of Executives’ External Pay Gap? Evidence from China," International Journal of Social Sciences Perspectives, Online Academic Press, vol. 11(2), pages 80-92.
    • Handle: RePEc:oap:ijossp:v:11:y:2022:i:2:p:80-92:id:643
    as

    Download full text from publisher

    File URL: http://onlineacademicpress.com/index.php/IJSSP/article/view/643/636
    Download Restriction: no
    File URL: http://onlineacademicpress.com/index.php/IJSSP/article/view/643/683
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oap:ijossp:v:11:y:2022:i:2:p:80-92:id:643. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Heather Rothman (email available below). General contact details of provider: http://onlineacademicpress.com/index.php/IJSSP/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.