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Forced board changes: Evidence from Norway

Author

Listed:
  • Nygaard, Knut

    (Dept. of Economics, Norwegian School of Economics and Business Administration)

Abstract

The recently introduced gender quota on Norwegian corporate boards dramatically increased the share of female directors. This reform offers a natural experiment to investigate changes in corporate governance from forced increases in gender diver- sity, and whether these changes in turn impact firm performance. I find that investors anticipate the new directors to be more effective in firms with less information asymmetry between insiders of the firm and outsiders. Firms with low information asymmetry experience positive and significant cumulative abnormal returns (CAR) at the introduction of the quota, whereas firms with high information asymmetry show negative but insignificant CAR.

Suggested Citation

  • Nygaard, Knut, 2011. "Forced board changes: Evidence from Norway," Discussion Paper Series in Economics 5/2011, Norwegian School of Economics, Department of Economics.
    • Handle: RePEc:hhs:nhheco:2011_005
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    More about this item

    Keywords

    Natural experiment; Regulation; Corporate governance; Gender quota.;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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