Impacts Of Female Leadership On Business Outcomes: Evidence From South Asia And Middle East And North Africa

Research purpose: This paper aims to explore the impacts of female top managers on various business outcomes, including firm performance, financial investment decisions, access to finance, bribery practices, and technology adoption across South Asia and Middle East and North Africa (MENA). Research motivation: Women’s empowerment and gender equality have increasingly become central themes in discussions on economic and social development. There is a growing body of evidence suggesting that gender diversity, particularly in leadership positions, can have significant positive impacts on business outcomes. However, significant gender disparities persist, particularly in regions such as South Asia and MENA. This study aims to address these disparities, providing critical insights that could inform policies and initiatives designed to promote broader gender equality in these regions, ultimately paving the way for more inclusive and successful businesses. Research design, approach, and method: Our sample includes 4,746 firms in 12 countries located in MENA and South Asia regions from 2009 to 2023. We employ a firm fixed effects model to address the endogeneity issues often inherent in empirical research. By controlling for unobserved, time-invariant firm-specific characteristics that could be correlated with both business outcomes and the gender composition of top management, the firm fixed effects model can produce an unbiased estimate of the impacts of female top managers. Main findings: Our findings reveal that the inclusion of at least one woman in the top management board significantly enhances firm performance, resulting in higher revenue, revenue growth, and labour productivity. Besides, female-led firms have better access to finance and are more likely to adopt technologies compared to their male-led counterparts. Moreover, we detect no significant difference in the inclination towards corruption practices between female-led and male-led businesses, nor do female-headed firms face discrimination in the financial market. Practical/managerial implications: Our study offers meaningful policy implications to address barriers to gender diversity and promote inclusive leadership practices among firms. These policies not only enhance business outcomes such as increased revenue and innovation adoption but also contribute to broader societal goals of gender equality and economic empowerment.