See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/335613850

Do gender diversity and CEO gender enhance firm’s value? Evidence from an
emerging economy

Article  in  Corporate Governance International Journal of Business in Society · August 2019

DOI: 10.1108/CG-03-2019-0085

CITATIONS READS

31 1,172

3 authors:

Irfan Ullah Hong Xing Fang

Dongbei University of Finance and Economics Dongbei University of Finance and Economics
23 PUBLICATIONS   170 CITATIONS    10 PUBLICATIONS   222 CITATIONS   

SEE PROFILE SEE PROFILE

Khalil Jebran
Dongbei University of Finance and Economics
65 PUBLICATIONS   769 CITATIONS   

SEE PROFILE

Some of the authors of this publication are also working on these related projects:

How to apply DID (difference in difference) in STATA? View project

All content following this page was uploaded by Irfan Ullah on 14 September 2019.

The user has requested enhancement of the downloaded file.

Do gender diversity and CEO gender
enhance firm’s value? Evidence from an
emerging economy
Irfan Ullah, Hongxing Fang and Khalil Jebran

Abstract Irfan Ullah is based at the

Purpose – This paper aims to examine whether and how gender diversity and CEO gender can influence Dongbei University of
firm value in the emerging market of Pakistan. The study further tests whether these relations vary across Finance and Economics,
state-owned enterprises (SOE) and non-state-owned enterprises (NSOE). Dalian, Liaoning, China.
Design/methodology/approach – This study considers Pakistani listed firms over the period 2010- Hongxing Fang and Khalil
2017. The firms have been divided into SOE and NSOE for additional analysis. Tobin’s Q is used to Jebran are both based at
measure firm’s value.
the School of Accounting,
Findings – The authors document that female directors (FDirectors) on corporate boards is positively
Dongbei University of
associated with firm value. The findings also illustrate that female CEOs (FCEOs) enhances a firm value.
Finance and Economics,
Additional analyses show that the influence of FDirectors and FCEOs on firm value is stronger in NSOE
than in SOE. Dalian, Liaoning, China.
Practical implications – The results suggest that gender diversity and CEO gender play a significant
role in corporate decisions. The findings imply that FDirectors discipline the management, reduce
agency conflicts and thereby improve corporate governance, resulting in higher firm value.
Originality/value – This study has two important contributions. First, while prior studies mostly based
their arguments on using gender diversity of corporate boards, this study shows that a firm performance
can be significantly improved if a female serves as a CEO. Second, this study also tests the stated
relations for SOE and NSOE and show that gender diversity plays a significant role in NSOE than in SOE.
Keywords Pakistan, Gender, Emerging markets, Firm value, Female CEO
Paper type Research paper

1. Introduction
The global financial crisis and various corporate scandals over the past decades, such as
WorldCom, Tyco and Enron, have gained considerable interest among policymakers, to
improve the corporate governance mechanisms. Studies have identified various
governance mechanisms to improve corporate decisions, among which board gender
diversity has been identified an important factor that can improving board decisions and
corporate governance (Adams and Ferreira, 2009; Catalyst, 2003; Chen et al., 2018a,
2018b; Post and Byron, 2015)[1]. Given the significant importance of gender diversity,
several developed and emerging countries, such as, Sweden, Spain, France and Malaysia,
including other, have made it mandatory that a significant portion of board should be Received 8 March 2019
Revised 18 May 2019
occupied by female directors (FDirectors) (Gul et al., 2011; Terjesen et al., 2016; Abdullah 2 August 2019
et al., 2016). Accepted 5 August 2019

The authors are thankful to the

Studies have identified several firm-level advantages linked with gender diversity on the Editor, Gabriel Eweje,
board. These advantages consist of efficient decision-making (Milliken and Martins, 1996), Associate Editor, Aymen
Sajjad, and two anonymous ref-
effective monitoring and control of board (Nielsen and Huse, 2010a, 2010b; Adams and erees for many insightful and
Ferreira, 2009; Benkraiem et al., 2017), and higher firms financial performance constructive arguments.

DOI 10.1108/CG-03-2019-0085 © Emerald Publishing Limited, ISSN 1472-0701 j CORPORATE GOVERNANCE j

 (Terjesen et al., 2016). Compared with the male counterpart, FDirectors are believed to
have skills and abilities to monitor and provide advisory role in the board (Adams and
Ferreira, 2004; Daily et al., 1999; Johnson et al., 2013). Thus, several studies suggest that
FDirectors improve board behaviors and thus firm value (Isidro and Sobral, 2015; Liu et al.,
2014; Terjesen et al., 2016). Most importantly, studies show that the efficiency of corporate
decisions increases if a female is also serving as a CEO. For instance, Vähämaa (2017)
argues that female CEOs (FCEOs) curbs managerial opportunism by monitoring their
activities. Further, Chen et al. (2018a, 2018b) suggest that FCEOs increases a firm’s
innovation by reducing information asymmetry between shareholders and managers.
Similarly, Adhikari (2018) argue that female executives are more conscious about the future
of the firm; therefore, they hold more cash for precautionary measures.
These above arguments illustrate that any governance mechanism which reduces agency
problems can enhance firm value. Studies suggest that a firm experiences fewer agency
conflicts if a board has a larger proportion of female on board or if a firm has a FCEO
(Adams and Ferreira, 2009; Pucheta-Martı́nez et al., 2018). This illustrates that firms with
FDirectors may have fewer agency problems, which is the resultant of reduction in
managerial opportunism behavior. Based on the discussion so for, we can infer that,
FDirectors and FCEOs are associated with better internal control, which reduces agency
conflict and increases firm value. This study links this viewpoint and examines whether
FDirectors and FCEOs help to promote firm’s value in the context of Pakistan. Specifically,
this study seeks to answer the following questions: Does there exist an association between
FDirectors and firm value in firms listed in Pakistan Stock Exchange (PSX, after this)? Does
there exist a nexus between FCEO and firm value in firms in PSX? Do the effects of
FDirectors and FCEO on firm value vary across state-owned enterprises (SOE) and non-
state-owned enterprises (NSOE)?
Pakistan provides an excellent laboratory to study the stated relationships for at least two
reasons. First, the cultural and corporate environment in Pakistan is significantly dominated
by male, which doesn’t allow females to climb the ladder on corporate boards (Mirza et al.,
2012). It is obvious from the fact that still, there is no mandatory requirement of female
representation on corporate boards in Pakistan (Mirza et al., 2012). However, even without
mandatory requirement, Pakistani firms still have women on board. Our sample shows that
approximately 41.5 per cent of the firms have at least one FDirectors on board. Thus,
Pakistan provides an ideal setting to find the nexus between FDirectors and firm value in an
economy in which there is no legal requirement of women of board.
Second, in Pakistan, corporate decision in listed firms are significantly influence by political
interventions, which increases the conflict between minority and controlling shareholders;
thus agency conflicts is a severe concern in Pakistani firms (Ghazali and Bilal, 2017).
Therefore, it is essential to modify the corporate governance mechanisms to mitigate
agency conflicts and thus improve firm value. We expect that female directors on corporate
boards can play an important role by having diverse representation, which may in turn
increase a firm value.
To test the above predictions, we collect financial and corporate governance information of
223 firms of Pakistan during the period 2010 to 2017. We find that FDirectors is positively
linked with firm value. Further, we also document that firm value is significantly improved if a
female serves the CEO. Additional analysis indicates that the effects of FDirectors and
FCEO on firm value are more prominent for NSOE compared to SOE. The results are
consistent to alternative measures, endogeneity issues and robustness tests. Overall, the
findings illustrate that FDirectors can improve corporate governance mechanisms by
mitigating agency conflicts and thus increase firm value.
This study contributes to the literature in several ways. First, the research on the influence of
FDirectors on firm value is limited to emerging economies, especially in the context of

j CORPORATE GOVERNANCE j
Pakistan. Thus, this study adds an empirical evidence to the literature on emerging markets
by showing that FDirectors can enhance firm value. In addition, our findings enrich the
literature by indicating that FDirectors can play a significant role in promoting corporate
governance in an economy, in which there are no legal requirements of women on
corporate boards. Second, majority of the study based their conclusions on the bases of
FDirectors, while only a few shows that FCEOs are also important in corporate governance
(Adams and Ferreira, 2009; Frye and Pham, 2018). Our empirical findings provide new
evidence by showing that a firm value can be significantly improved if a female serves the
position of CEO. Finally, we posit that the impact of FDirectors and FCEO on firm value is
stronger for NSOE compared to SOE. There is growing interest among researchers on the
consequences of firm owned by the one or two groups such as directors, managers, block-
holders, family owners and institutional investors (Javid, 2012; Javid and Iqbal, 2008; Khan
and Nouman, 2017), but no study has been conducted on consequences of a firm owned
by the government in Pakistan. This study enhances our knowledge by showing that the
effect of FDirectors on firm value differs across firms of different nature.
The rest of the paper proceeds as follow. Section 2 represents the institutional background
and develops hypothesis. Section 3 presents methodology. Section 4 reports empirical
results. Section 5 reports additional tests and robustness test. The final section concludes.

2. Institutional background and hypotheses development

2.1 Institutional background
The institutional environment of Pakistan is quite different from other developing and
emerging economies. Therefore, to contextualize the relationship between FDirectors,
FCEOs, and firm’s value is important to provide an overview of how female directors
evolved in corporate sectors.
Female representation in the corporate industry has gained ample attention from experts,
academic researchers, practitioners and policymakers. Many countries encouraged and
required firms to nominate more female on corporate boards (Carter et al., 2010). Some of
the Western economies require a mandatory quota of female on board, while others have
provided soft recommendations. Increasing female participation is considered to enhance
the corporate decisions and governance quality (Ayadi et al., 2015; Adams and Ferreira,
2009; Green and Homroy, 2018).
Pakistan has been influenced by strong men dominating culture for a long time, where
women often play the role of subordinates. Thus, it has always been resembled as a male-
dominated society. Therefore, there exists a disparity between male and female reaching
the highest echelons of an organization[2]. Despite of the fact, the Article 38 of the
Constitution of Pakistan “guarantees citizens the right to pursue economic opportunities
irrespective of sex, caste or creed and related labor laws”, and at the same time the
Government of Pakistan’s principal planning document vision 2025 recognizes expanding
female’s participation and access to opportunities as central to prolonged economic and
social development.
Pakistan has seen significant changes in the attitudes towards gender in its history.
However, the economic thrust to consider the female participation in a corporate
environment and some examples of extraordinary female performance on top positions
changed the conservative concept of people in Pakistan. The constitution of the Islamic
Republic of Pakistan has given equals rights to both males and females. Females in
Pakistan have continued to play a significant role in every aspect of life. They have achieved
great achievements in different fields such as education, health, engineering, media, army,
business and more prominently in sports and politics. They have undertaken a tremendous
effort especially in the field of politics, such as, Fatima Jinnah (called as Madr-e-Millat) one
of the pioneer and founding leaders of Pakistan and Benazir Bhutto, who was the first

j CORPORATE GOVERNANCE j
 Muslim women Prime Minister in Pakistan’s history. In the field of finance, Shamshad Akhter
was the first women to get the position of the Governor of the State Bank of Pakistan.
Similarly, many examples can be found in different sectors, for example, in IT sector,
youngest Microsoft Certified Professional Arfa Kareem, or Shukira Khanam in aviation field,
the first Pakistani women pilot. Some of the women, e.g. Noor Jahan got the highest civilian
awards, i.e. “Sitar-e-Imtiaz and Tamgha-e-Imtiaz” on behalf of their contribution in the field
of music.
About 45 per cent of women entrepreneur in Pakistan run a traditional business such as
bakeries, boutiques, parlors and the majority of the females are employed in IT and large
multinational firms (The Observer, 2017). In 2003-2004, women participation in growth rate
was approximately 15.9 per cent, which increased to approximately 18.9 per cent in
2014[3]. These efforts reveal that female in Pakistan is an important source, which can
contribute to economic growth. Gender diversity (more specifically, gender parity) would
add $28bn to the world economy by 2,025[4] and in Pakistan women empowerment will
improve the size of Pakistan economy by approximately 30 per cent (The News, 2017)[5]. In
2017, Center of Excellence Business (CERB) conducted a survey on gender diversity in
business sectors in Pakistan and found that the average size of the firm board has seven
directors in industries such as Fast Moving Consumer Goods (FMCG) firms, banking and
finance, logistics, textile and cement, having female directors ranges from 1 to 4.
The efforts and interest in increasing female representation of corporate boards show that it
has become an important source of improving the corporate governance mechanism. This
study is a pioneering attempt to investigate the association between female and firm value
in Pakistan. The increased participation of female on corporate boards provides an
opportunity to explore whether it is associated with firm value.

2.2 Hypotheses development

Standard corporate governance focuses on the improvement of tools and techniques that
ensure the monitoring of the managers which can enhance a firm value (Bhat et al., 2018;
Brammer et al., 2007). Among such standards, gender diversity has been identified as one
of the vital tools that can promote monitoring mechanisms (Gallego-Álvarez et al., 2010).
The association between board gender diversity and firm value is generally discussed in
the agency theory framework, which highlights the monitoring function of gender diverse
board. Thus, it is important to increase the proportion of female directors on board that may
improve corporate governance, by reducing agency conflicts and enhancing firm value.
2.2.1 Female directors and firm value. Several studies (Alazzani et al., 2017; Carter et al.,
2010; Kyaw et al., 2017) support the view that FDirectors induce a firm’s performance. For
instance, Carter et al. (2010) posit that board diversity can improve firms value because it
brings unique features, skills, talents and abilities to the boardrooms. Similarly, several
studies (Campbell and Mı́nguez-Vera, 2008; Ronald, 1994) suggest that gender diversity
insert diverse perspectives into the board, which in turn enhances the chances of solving
complex issues. Therefore, the board of directors with different background, especially
gender, provides valuable resources, thus promoting firm performance (Ujunwa et al.,
2012).
Extant literature shows that FDirectors on board increase the efficiency of internal
governance by increasing, the monitoring efficiency (Adams and Ferreira, 2009), public
disclosure of stock price informativeness (Gul et al., 2011), board independence and
activism (Perrault, 2015), and board consideration of complex problems (Huse and Grethe
Solberg, 2006). Thus, it is evident that female representation in the board helps restraints
agency conflicts and could increase firm value by exerting efficient monitoring.
The relationship between FDirectors and firm performance is still inconclusive. Majority of
the literature have reported positive (Isidro and Sobral, 2015; Liu et al., 2014; Terjesen et al.,

j CORPORATE GOVERNANCE j
2016), whereas some have found negative (Ahern and Dittmar, 2012; Larcker et al., 2007;
Shrader et al., 1997), some documented no link between gender diversity and firm
performance (Chapple and Humphrey, 2014; Siciliano, 1996), a few shows mixed results
(Abdullah et al., 2016). The inconsistent results may be due to considering different, in time
frames for analysis (Campbell and Mı́nguez-Vera, 2008), social and political pressure
(Green and Homroy, 2018), institutional background (Sabatier, 2015), lack of constant
measures of performance (Terjesen et al., 2016) and endogeneity problems (Campbell and
Mı́nguez-Vera, 2008).
Majority of studies on gender diversity on corporate boards examine US firms (Adams and
Ferreira, 2009; Torchia et al., 2011) and European firms (Dale-Olsen et al., 2013; Eckbo
et al., 2016; Gregory-Smith et al., 2014). Very few studies have been carried out for Asian
countries (Abdullah et al., 2016; Low et al., 2015) for example, Hong Kong, Malaysia,
Singapore and South Korea. Asian firms may differ from US and UK firms regarding
controlled, social, and political background, religious, and cultural limits, especially
regarding female inclusion in corporate environment. Although there is extensive research,
there is no consensus on whether FDirectors influence firm value in the context of Pakistan.
We argue that FDirectors can play an important role in firm value. Firms listed in Pakistan
have one tier board structure, and the majority of public hold concentrated ownership
structures with business association ownership or strong family ownership (Yasser and
Mamun, 2016). Thus, due to such types of ownership, the corporate environment is
categorized by strong asymmetries among management, minority and controlling
shareholders, which leads to create agency conflicts among these stakeholders (Ghazali
and Bilal, 2017). Several studies reported that agency conflicts are severe concerns of
corporate governance in Pakistan (Ghazali and Bilal, 2017; Sajid et al., 2012; Yasser and
Mamun, 2016). To overcome agency issues, various reforms and governance mechanisms
have been introduced by Security Exchange Commission of Pakistan (SECP), which include
“2002 Corporate Governance Code”, and a Revised Governance Code (2012). Besides
these codes, various institutional and governmental initiative have been implemented over
the past decade. Different key departments, for example, National Investment Trust (NIT),
Investment Corporation of Pakistan (ICP), and institutional investors play their role in
promoting governance mechanism to attenuate agency conflicts between shareholders and
managers (Ghazali and Bilal, 2017; Sajid et al., 2012).
As agency conflicts is a legitimate concern of Pakistani firms; one can argue that FDirectors
can play an important role in mitigating agency problems, thereby enhancing firm value.
Our argument is hinged on the view that FDirectors can play a monitoring role, and thereby
can improve the governance practices, leading to high firm performance. Thus, we develop
our first hypothesis:
H1. Female directors on board have a positive effect on the firm’s value.
2.2.2 Female CEOs and firm value. Prior studies suggest that female directors help restrain
information asymmetry and agency conflicts (Chen et al., 2018a, 2018b; Francoeur et al.,
2008). For example, FCEOs are facilitating in the implementation of strong corporate
governance to improve corporate investment decisions (Frye and Pham, 2018; Nielsen and
Huse, 2010a, 2010b). Extant research suggests that female on board plays key role in
improving a firm’s monitoring intensity (Adams and Ferreira, 2009). Similarly, Adhikari
(2012) find that “firm having FCEOs hold more cash, keep lower financial leverage, make
the lower level of capital expenditure, and thus have lower systematic risk, compared to
those with male CEOs. Prior studies (Jurkus et al., 2011; Melero, 2011) argue that FDirectors
enhance firms performance through useful monitoring tools.
Further, Frye and Pham (2018) suggest that FCEOs are efficient in monitoring than their
male peers. Concerning risk-averse behavior, females avoid more risk than their male
(Adhikari et al., 2019; Jianakoplos and Bernasek, 1998; Schubert et al., 2000; Adhikari and

j CORPORATE GOVERNANCE j
 O’Leary, 2011) which leads to improving corporate decisions. In addition,
Faccio et al. (2016) argue that “firms having FCEOs have lower leverage, less volatile
earning, and the higher chance of survival than male CEOs firms.” More recently, Chen
et al. (2018a, 2018b) document that female leaders enhance innovation by practicing active
policies and mitigating agency conflict through control mechanisms. These studies suggest
that females in organizational leadership, especially FCEOs affect corporate decisions by
improving governance mechanisms and making such decisions which increase firm value.
Based on the discussion so far, we expect that compared to male CEOs, FCEOs will better
monitor managers and reduce agency conflicts. Thus, FCEOs are likely to have more
positive effect on firm value. Thus, our second hypothesis:
H2. FCEO has a positive impact on the firm’s value.
2.2.3 Female directors and firm value in state-owned enterprises and non-state-owned
enterprises. SOE play a crucial role in the growth and development of the economy. Peng
et al. (2016) find that SOE constitute almost 5 per cent of GDP of OECD member nations.
SOE also play an important role in providing investment opportunities by increasing
employment opportunities. In Pakistan, SOE also play an important role in economic
development, providing employment, and enhance the welfare of people (add reference).
Compared to NSOE, SOE exhibit a higher possibility of agency conflicts due to their closer
linkage with the government and lower representation of FDirectors in their board.
Moreover, since SOE generally have monopoly power in particular areas (especially in
regulatory industries), thus they are liable to fulfill socio-political aims (Majeed et al., 2018;
Jebran et al., 2019) rather than enhancing firm value. Similarly, relative to NSOE, SOE have
less space to allow the association between gender diversity and firm value. Therefore, we
expect that the positive effects of FDirectors and FCEOs on firm value are marginally offset
in SOE. Thus, the relation between FDirectors (FCEOs) and firm value is less pronounced
for SOE. Thus, our third hypothesis:
H3a. The positive effect of FDirectors on firm value is less pronounced for SOE than for
NSOE.
H3b. The positive effect of FCEOs on firm value is less pronounced for SOE than for
NSOE.

3. Data and methodology

3.1 Sample selection
Our initial sample comprised all firms listed on the Pakistan Stock Exchange (PSX) over the
period 2010-2017. There are 337 firms listed on PSX in our sample period. We then select
our sample using the following criteria. First, we excluded financial companies because of
their unique accounting and financial features. Second, we excluded firms that were
defaulted during the sample period. Third, we drop firms of missing data on control
variables. Finally, we excluded firms which do not have complete annual reports for define
period. Our final sample includes 1,710 firm-year observations of 220 non-financial firms
belonging to 20 industries over the period 2010 to 2017.
The data for FDirectors and FCEOs have been manually collected from financial reports of
non-financial firms published by the State Bank of Pakistan (SBP). The data for other
variables are obtained from Wharton Research Data Services (CompStat).

3.2 Variables measurement

3.2.1 Dependent variable. Following prior studies (Coles et al., 2008; Hauser, 2018; Zhu
et al., 2016), we used Tobin’s Q (market-based measure) for calculating firm’s value .

j CORPORATE GOVERNANCE j
Tobin’s Q is measured as the book value of total assets plus the sum of the market value of
stocks minus shareholder’s equity over book value of total assets.
To test the robustness of our results, we used two alternative accounting-based measures
of firm value: return on equity (ROE) and return on assets (ROA), following the literature
(Ahmadi et al., 2017; Zainab et al., 2016). ROE is used to measure accounting
performance, indicating the return on shareholder’s investment (Ahmadi et al., 2017;
Ellinger et al., 2002; Liu et al., 2015; Moreno-Go mez et al., 2018). ROA is measured as
earnings before interest and tax (EBIT) over total assets. ROA has been widely used as a
firm performance measure in previous gender diversity studies (Adams and Ferreira, 2009;
Green and Homroy, 2018; Moreno-Go mez et al., 2018).
3.2.2 Independent variables. The key independent variables used in this study are female
directors (FDirectors) and female chief executives (FCEOs). FDirectors is and indicator
variable that hold the value of one if the firm has at least one female director on board and
zero otherwise. We measured FCEOs with a dummy variable that returns the value of 1 if the
firm has a female CEO, and zero otherwise.
3.2.3 Control variables. We control for board level attributes (corporate governance
characteristics) and firm-level factors that may influence firm value, following the literature
(Bhat et al., 2018; Yermack, 1996). Board level control variables include board size, board
independence, and CEO duality, whereas firm-level control variables consist of firm age,
capital expenditure, firm size, tangibility, sale, operating cash flow and leverage.
Board size (BSize) is measured as the total number of directors on the board. Board with a
limited number of directors is more efficient at controlling managers (Randøy et al., 2009).
However, a higher number of board members could bring diverse skills, ability and
knowledge to the firm (Randøy et al., 2009). Board independence (Indep) has been
considered as a key indicator for internal control mechanisms; therefore, we used the
percentage of independent directors to control for the effect of different levels of board
oversight. The two measures of board size and board independence are considered
important indicators of determining firm performance (Kassinis and Vafeas, 2002; Walls
et al., 2012). CEO duality (Duality) refers to the situation in which a CEO also serves as the
chair of the board. We set the value of 1 if the CEO is also serving as board chairman, and
zero otherwise. We control for state-ownership (SOE), which is an indicator variable that
takes the value of 1 if the firm owned by the state, and zero otherwise.
Firm-level control variables, for example, firm age (Age) is measured as the natural
logarithm of the number of years since a firm was founded (Julizaerma and Sori, 2012;
Perryman et al., 2016). Capital expenditure (Cap) is the total capital expenditure over total
assets (Borghesi et al., 2016). Firm size (TA) is measured as the natural log of the total
assets of the firm (Frye and Pham, 2018). Firm size is considered an important determinant
of firm performance (Isidro and Sobral, 2015). Larger firms can increase the firm value more
efficiently than smaller firms because of higher market power (Smith et al., 2006). We
measured tangibility (Tang) as tangible assets over total assets. We also control for sale
(Sale), defined as the natural-log of total sale scaled by total assets. We measured
operating cash flow (OCF), as the natural-log of net operating cash flow scaled by total
assets. Following prior studies (Chen et al., 2011; Liu, 2018), we control for leverage (Lev),
which is measured as the ratio of total liabilities to total assets. Table I reports the definitions
of variables used in this study.

3.3 Model
To find the impact of gender diversity (FDirectors and FCEOs) on firm value, we opt
regression analysis following prior studies (Ahmadi et al., 2017; Julizaerma and Sori, 2012;
Low et al., 2015). We apply the following regression models:

j CORPORATE GOVERNANCE j
 Table I Variables definitions
Variables Label Definition

Dependent variables
Tobin’s Q Q Tobin’s Q = (Total Assets þ Market Capitalization - Shareholder’s Equity)/Total Assets
Return on assets ROA ROA = EBIT/ Total assets
Return on equity ROE ROE= Net income/ shareholder’s equity
Independent variables
Female Directors FDirectors An indicator variable that returns the value of 1 if there is one or more females on a board, and
zero otherwise
Female Chief Executives FCEO An indicator variable that hold the value of 1 if the firm has female chief executive, and zero
otherwise
Board level control variables
Board size BSize Total board members
Board independence Indep Percentage of independent directors on board
CEO duality Duality Binary variable that take the value of one if the CEO is also the chairman of the board, and zero
otherwise
Firm level control variables
Firm age Age Number of years since the firm is founded or incorporated
Capital expenditure Cap Capital expenditure/total assets
Total assets TA Natural log of total assets
Tangibility Tang Property, Plant and Equipment/total assets
Sale Sale Sale/total assets
Operating cash flow OCF Operating cash flow/total assets
Leverage Lev Total liabilities/total assets
State-owned enterprise SOE A dummy variable which equals one if the firm is owned by state, and zero otherwise

Qit ¼ b 0 þ b 1 FDirectorsit þ b 2 BSizeit þ b 3 Indepit þ b 4 Dualityit þ b 5 Ageit

þ b 6 Capit þ b 7 Sizeit þ b 8 Tangit þ b 9 Saleit þ b 10 OCFit
þ b 11 Levit þ b 12 SOEit þ INDUSTRY þ YEAR þ m it (1)

Qit ¼ b 0 þ b 1 FCEOsit þ b 2 BSizeit þ b 3 Indepit þ b 4 Dualityit þ b 5 Ageit þ b 6 Capit

þ b 7 Sizeit þ b 8 Tangit þ b 9 Saleit þ b 10 OCFit þ b 11 Levit þ b 12 SOEit
þ INDUSTRY þ YEAR þ m it
(2)

where Q it represents Tobin Q. FDirectorsit denotes female directors; FCEOsit denotes

female CEO; and other variables, such as, BSize it (total directors); Indept (proportion
of independent directors); Dualityit (CEO duality);SOEit (state-owned enterprise);
Ageit (firm age); Cap it (capital expenditure); Size it (Size of the firm); Tangit (tangibility
assets), Saleit (total sales); OCFit (operating cash flow); and Levit (leverage).

4. Empirical results
4.1 Descriptive statistics
Table II presents descriptive statistics. We find that the average of Tobin’s Q is
approximately 1.36, with a standard deviation of 1.227. We find that approximately 41.50
per cent of the firms in our sample have at least one female, which indicates male-
dominated corporate boards. However, the number of FDirectors in Pakistan is low as
compared to US and European firms. Further, we observe that approximately 3.5 per cent
of the firms have a female serving as a CEO.
For control variables, the results show that on average, the number of directors on board is
approximately 8.04, and independent directors hold approximately 13.9 per cent of the

j CORPORATE GOVERNANCE j
 Table II Summary statistics
Statistics Q FDirectors FCEOs BSize Indep Dual Cap TA Tang Sale OCF Lev Age

Full sample Observations 1710 1710 1710 1710 1710 1710 1633 1710 1710 1700 1710 1710 1709
Mean 1.3603 0.4152 0.0350 8.0421 0.1394 0.248538 0.0517 8.6244 0.4793 1.1442 0.0670 0.5915 36.200
P25 0.7685 0.0000 0.0000 7.0000 0.0000 0.0000 0.0123 7.4388 0.3277 0.6064 0.0044 0.4145 23
P50 0.9657 0.0000 0.0000 7.0000 0.125 0.0000 0.0321 8.4835 0.4848 1.0290 0.0521 0.5673 32
P75 1.4185 1.0000 0.0000 9.0000 0.1428 0.0000 0.0691 9.7900 0.6458 1.5345 0.12863 0.7135 48
SD 1.2265 0.4929 0.1840 1.5460 0.1469 0.6192 0.0594 1.6207 0.2246 0.7608 0.11276 0.30551 19.1446
SOE Observations 502 502 502 502 502 502 479 502 502 492 502 502 501
Mean 1.2352 0.3904 0.0478 7.9582 0.1464 0.3865 0.0532 8.6960 0.4708 1.0792 0.0572 0.5492 38.8643
P25 0.7403 0.0000 0.0000 7.0000 0.0000 0.0000 0.0126 7.0931 0.3004 0.5597 0.0103 0.3495 23.0000
P50 0.9496 0.0000 0.0000 7.0000 0.1429 0.0000 0.0320 8.3563 0.4995 0.9557 0.0487 0.5373 34.0000
P75 1.3483 1.0000 0.0000 8.0000 0.1429 1.0000 0.0690 10.4256 0.6293 1.4142 0.1144 0.6912 52.0000
SD 0.9997 0.4883 0.2136 1.7142 0.1494 0.9530 0.0642 2.0158 0.2312 0.7649 0.1143 0.3065 24.0230
NSOE Observations 1207 1207 1207 1207 1207 1207 1153 1207 1207 1207 1207 1207 1207
Mean 1.4133 0.4258 0.0298 8.0762 0.1362 0.1914 0.0512 8.5938 0.4826 1.1716 0.0713 0.6096 35.0671
P25 0.7745 0.0000 0.0000 7.0000 0.0000 0.0000 0.0122 7.5876 0.3340 0.6268 0.0019 0.4358 23.0000
P50 0.9738 0.0000 0.0000 8.0000 0.1250 0.0000 0.0323 8.5330 0.4815 1.0685 0.0533 0.5818 31.0000
P75 1.4460 1.0000 0.0000 9.0000 0.1429 0.0000 0.0694 9.5663 0.6499 1.5836 0.1363 0.7215 47.0000
SD 1.3064 0.4947 0.1702 1.4703 0.1455 0.3936 0.0574 1.4250 0.2217 0.7575 0.1119 0.3033 16.5739
t-statistics Statistics 2.7376 2.2610 1.8404 1.4380 1.3041 5.9901 0.6024 1.1882 0.9931 2.2739 2.3563 3.7375 3.7484
Notes: The table reports summary statistics. See Table I for variables definitions;  ,  and  indicate significance at 1, 5 and 10% levels respectively

j CORPORATE GOVERNANCE j
 proportion of board positions. The CEO is also the chair of the board for about 24.9 per cent
of the sampled firms. The average leverage ratio is 59.20 per cent. The mean firm’s age is
our sample is approximately 36 years. On average, capital expenditure, tangibility, sale,
and operating cash flow are approximately 5 per cent, and 4 per cent, 11 per cent and 6
per cent, respectively. In our sample, 29.40 per cent of the firms are owned by the state.
Finally, total assets, a proxy of firm size, has an average value of 8.6240. All the variables
are winsorized at 1 per cent to eliminate the influence of outliers.
We further classified our sample in SOE and NSOE to check whether the statistics vary
across the two types of firms. Table II reports significant differences in the statistics of SOE
and NSOE. Specifically, we document higher mean values of Q and FDirectors in case of
NSOE, whereas a higher mean value of FCEOs for SOE. These statistics suggest that
studying the association of FDirectors, FCEO, with firm value for SOE and NSOE is a
legitimate concern in Pakistan.
Finally, we applied two-sample t-test to further confirm our predictions. The results reported
in Table II confirm statistically significant t-statistics for our core variables that are Q,
FDirectors and FCEOs.

4.2 Correlations matrix

Table III reports the correlation analysis of variables used in our models. The results
demonstrate a positive correlation coefficient on FDirectors, although insignificant, the sign
still supports the view that female directors are positively correlated with Q (firm value).
Further, we find significant positive correlation coefficient on FCEOs, suggesting that female
CEOs is positively correlated with firm value. As for control variables, we find that significant
positive correlations coefficients on BSIZE, Indep, Age, Cap, TA, Sale, OCF and Lev,
whereas significant negative correlation coefficients on SOE, Duality and Tang.

4.3 Female directors and firm value

Table IV reports the results of the effect of FDirectors on firm value. Columns (1), (2) and (3)
provide the results for full sample, SOE and NSOE. The results show positive and significant
coefficient on FDirectors in full sample, which reveals that gender diversity positively
impacts firm value. Hence, H1 is supported. The findings are consistent with prior studies
(Campbell and Mı́nguez-Vera, 2008; Carter et al., 2010; Perryman et al., 2016) that show
that FDirectors on board enhance a firm value.
Further, Column (2) shows an insignificant coefficient on FDirectors, which suggest that
FDirectors are less likely to play its role in SOE in Pakistan. However, we find a significant
positive effect of FDirectors on firm value for NSOE, which suggest that female directors
improve firm value in NSOE. These findings support H3a, showing that FDirectors and firm
value association is stronger in NSOE compared to SOE.
As for control variables, the results are congruent with prior studies (Bennouri et al., 2018; Liu
et al., 2014). The results signify that Duality has a significant and negative coefficient in both
full samples and in NSOE, which indicate that a CEO with dual responsibility is less likely to
improve firm value. But, in SOE, Duality is insignificant. Further, board independence has a
significant positive relationship with firm value. Board size and firm size have no significant
association with firm value. In addition, the firm age has a positive association with firm value,
which indicates that older firms have more experience, which enhances firm value. We also
find a positive and significant relationship between leverage and firm value in all columns.

4.4 Female CEO and firm value

Table V reports the regression results of the effect of FCEOs on firm value. The results
indicate that the association between FCEO and Tobin’s Q is positive and significant, which

j CORPORATE GOVERNANCE j
 Table III Correlation matrix
Variables Q FDirectors FCEOs BSize Indep Duality Age Cap TA Tang Sale OCF Leverage SOE

Q 1.0000
FDirectors 0.0210 1.0000
FCEOs 0.136 0.226 1.0000
BSize 0.070 0.066 0.048 1.0000
Indep 0.045 0.0220 0.0310 0.085 1.0000
Duality 0.083 0.137 0.093 0.149 0.042 1.0000
Age 0.155 0.0250 0.166 0.085 0.148 0.0470 1.0000
Cap 0.112 0.0290 0.0040 0.0060 0.0190 0.067 0.0240 1.0000
TA 0.071 0.131 0.119 0.365 0.104 0.0350 0.113 0.089 1.0000
Tang 0.172 0.179 0.0120 0.134 0.076 0.065 0.093 0.120 0.101 1.0000
Sale 0.212 0.0050 0.079 0.059 0.098 0.082 0.065 0.0190 0.126 0.401 1.0000
OCF 0.376 0.0320 0.087 0.105 0.0230 0.093 0.086 0.087 0.141 0.0390 0.267 1.0000
Lev 0.043 0.0070 0.046 0.062 0.0110 0.138 0.136 0.128 0.127 0.232 0.067 0.240 1.0000
SOE 0.066 0.0330 0.045 0.0350 0.0320 0.143 0.090 0.0150 0.0290 0.0240 0.055 0.057 0.090 1.0000
Notes: See Table I for variables definitions.  ;  and  denote significance at 1, 5 and 10% levels, respectively

j CORPORATE GOVERNANCE j
 Table IV Female directors and firm value
(1) (2) (3)
Variables Full sample SOE NSOE

FDirectors 0.165 (0.0482) 0.175 (0.109) 0.326 (0.0609)

BSize 0.0129 (0.0145) 0.0179 (0.0195) 0.000682 (0.0181)
Indep 0.239 (0.132) 0.204 (0.172) 0.199 (0.164)
Duality 0.0776 (0.0243) 0.00481 (0.0247) 0.294 (0.0780)
Age 0.00565 (0.00141) 0.00164 (0.00180) 0.00969 (0.00235)
Cap 2.289 (0.476) 1.516 (0.591) 1.898 (0.618)
TA 0.0170 (0.0153) 0.0114 (0.0179) 0.0689 (0.0218)
Tang 0.891 (0.124) 0.547 (0.265) 0.977 (0.138)
Sale 0.143 (0.0426) 0.0131 (0.0635) 0.193 (0.0497)
OCF 3.997 (0.428) 3.414 (0.756) 3.990 (0.446)
Lev 0.890 (0.111) 0.801 (0.115) 0.953 (0.163)
Year Yes Yes Yes
Industry Yes Yes Yes
Constant 192.0 (22.73) 187.7 (37.47) 172.7 (25.69)
R-squared 0.292 0.218 0.338
Observations 1,632 478 1,153
  
Notes: See Table I for variables definitions. Robust standard errors in parentheses. , and denote significance at 1, 5 and 10%
levels, respectively

Table V Female CEOs and firm value

(1) (2) (3)
Variables Full sample SOE NSOE
 
FCEO 0.603 (0.197) 0.402 (0.306) 0.830 (0.262)
BSize 0.0188 (0.0149) 0.0319 (0.0224) 0.000623 (0.0181)
Indep 0.198 (0.138) 0.272 (0.190) 0.184 (0.174)
 
Duality 0.0771 (0.0251) 0.0151 (0.0257) 0.270 (0.0814)
 
Age 0.00490 (0.00141) 0.00113 (0.00183) 0.00851 (0.00239)
  
Cap 2.196 (0.467) 1.757 (0.599) 1.810 (0.616)

TA 0.0219 (0.0155) 0.000387 (0.0183) 0.0565 (0.0209)
  
Tang 0.830 (0.116) 0.627 (0.223) 0.901 (0.127)
 
Sale 0.141 (0.0414) 0.0350 (0.0639) 0.170 (0.0484)
  
OCF 3.935 (0.418) 3.396 (0.773) 3.979 (0.433)
  
Lev 0.852 (0.107) 0.907 (0.116) 0.808 (0.154)
Year Yes Yes Yes
Industry Yes Yes Yes
  
Constant 198.0 (22.93) 185.9 (36.47) 183.6 (26.85)
R-squared 0.295 0.218 0.335
Observations 1,632 478 1,153

Notes: See Table I for variables definitions. Robust standard errors in parentheses. indicates
significance at 1% level

provides support for H2. This result suggests that female in top management will produce
better result while increasing the market value of the firm. Further, Column (2) shows an
insignificant effect of FCEOs on firm value for SOE. However, we document a significant
positive effect of FCEOs on firm value in NSOE. This result supports H3b, suggesting that
the effect of FCEOs on firm value is more prominent in SOE compared to NSOE.
Regarding control variables, we find a positive and significant association between firm age
and firm value, which indicate that older firms may have more experience and potential and
can utilize their resources efficiently to enhance firm value. We observed a negative
association between tangibility and firm value in all columns. Further, we found a negative
relationship between CEO duality and firm value in the full sample and in NSOE, whereas
insignificant for SOE. Similarly, we find that sale is positively correlated with firm value.

j CORPORATE GOVERNANCE j
5. Additional tests and robustness analysis
5.1 Alternative measure of firm value
For robustness check, we used alternative measures of firm value, that are, ROE and ROA,
respectively. We report the findings of the impact of FDirectors on firm value in Table VI. We find
that FDirectors has a significant and positive association with ROE and ROA in full sample and for
NSOE. As expected, we document no such evidence regarding SOE. Most notably, firms that
have at least one female on the board enhance both ROE and ROA than firms that do not have.
Further, we report the results of the effect of FCEOs on firm value using ROA and ROE as
addition measure of firm value in Table VII. Consistent with our prior results, we document a
significant positive effect of FCEOs on firm value in full sample and for SOE, whereas
insignificant for NSOE. Overall, the findings of this section illustrate that our main results are
congruent with alternative measures of firm value.

5.2 Endogeneity issues

In previous sections, we investigate that FDirectors and FCEOs have positive impact on firm
value. However, this association may suffer from endogeneity. To address endogeneity
issues, we adopt two approaches. First, we use the lagged of the independent variables.
Using lagged independent variables is a suitable technique to control endogeneity issues in
corporate governance literature (Bennouri et al., 2018; Wintoki et al., 2012). Second, we opt
generalized method of moments (GMM) model to examine our main equations. The GMM
analysis provides potential instruments that address unobserved heterogeneity and
simultaneity, which is crucial to reduce any endogeneity problems (Wintoki et al., 2012).
Further, Wintoki et al. (2012) argue that GMM allows for present governance variables to be
effected by past performance. This assumption makes GMM superior over other
techniques, such as ordinary least square (OLS), fixed-effects and random-effects models.
We report the results of this section in Table VIII. Panel A shows the results of the effect of
FDirectors on firm value, whereas Panel B shows the results for the association between
FCEOs and firm value. Our findings remain valid after controlling for endogeneity issues.
Specifically, we document positive effects of FDirectors and FCEOs on firm value, and this
association is weaker for SOE.
We report the findings of the GMM model in Table IX. In Table IX, Panel A shows the results
of the effect of FDirectors on firm value, whereas Panel B shows the results for the
association between FCEOs and firm value. Consistent with our main results, we find that
FDirectors and FCEOs positively impact firm value, and this impact is stronger for NSOE.
Overall, the results of this section illustrate that our main findings are still consistent after
considering endogeneity issues.

6. Discussions and implications

6.1 Discussions
The purpose of this study is to examine whether female directors and female CEOs
influence the firm value in an emerging economy. Using a sample of Pakistani listed firms
for the period of 2010-2017, we find evidence that FDirectors is positively associated with
firms value. Our findings are consistent with the notion that female representation on the
board enhance firm value, because it improves corporate governance mechanism
(Carter and Simkins, 2003; Shrader et al., 1997), maintain good relationship and keep
effective communication with potential clients (Rose, 2007), broadened corporate image
(Lückerath-Rovers, 2013), enhance board effectiveness via bringing diverse perspectives
and non-conventional techniques to the board (Carter et al., 2010), brings social and
informational diversity benefits to the top management team and more specifically,
encourages women in the middle management(Dezsö and Ross, 2012).

j CORPORATE GOVERNANCE j
j CORPORATE GOVERNANCE j
Table VI Robustness check of female directors and firm value using alternative proxy of firm value
ROE ROA
(1) (2) (3) (4) (5) (6)
Variables Full sample SOE NSOE Full sample SOE NSOE

FDirectors 0.0319 (0.0141) 0.0244 (0.0270) 0.0357 (0.0173) 0.0136 (0.00394) 0.00298 (0.00681) 0.0161 (0.00443)
BSize 0.0128 (0.00525) 0.0141 (0.0114) 0.0132 (0.00512) 0.000330 (0.00137) 0.000334 (0.00228) 0.000293 (0.00152)
Indep 0.0316 (0.0602) 0.00234 (0.0867) 0.0577 (0.0810) 0.00216 (0.0130) 0.0127 (0.0196) 0.00709 (0.0167)
Duality 0.0137 (0.0102) 0.00596 (0.00910) 0.0163 (0.0304) 0.00231 (0.00250) 0.00566 (0.00216) 0.000621 (0.00746)
Age 0.000174 (0.000358) 0.000662 (0.000559) 0.000634 (0.000424) 3.75e-05 (9.17e-05) 0.000476 (0.000155) 0.000247 (0.000135)
Cap 0.460 (0.0986) 0.0200 (0.151) 0.605 (0.126) 0.0806 (0.0280) 0.0621 (0.0501) 0.114 (0.0345)
TA 0.0187 (0.00533) 0.0135 (0.00737) 0.0250 (0.00685) 0.0107 (0.00173) 0.0107 (0.00202) 0.0122 (0.00222)
Tang 0.155 (0.0431) 0.136 (0.0711) 0.177 (0.0528) 0.0810 (0.00963) 0.0780 (0.0173) 0.0828 (0.0116)
Sale 0.0526 (0.0128) 0.0165 (0.0202) 0.0573 (0.0166) 0.0334 (0.00410) 0.0228 (0.00662) 0.0353 (0.00472)
OCF 0.808 (0.0904) 0.619 (0.149) 0.891 (0.104) 0.392 (0.0257) 0.321 (0.0457) 0.412 (0.0306)
Lev 0.0235 (0.0460) 0.0762 (0.0605) 0.00960 (0.0602) 0.0933 (0.00951) 0.122 (0.0123) 0.0810 (0.0141)
Year Yes Yes Yes Yes Yes Yes
Industry Yes Yes Yes Yes Yes Yes
Constant 15.17 (7.747) 23.79 (11.95) 14.94(9.554) 11.25 (1.722) 14.21 (2.847) 10.75 (2.075)
R-squared 0.175 0.118 0.213 0.527 0.543 0.539
Observations 1,629 477 1,151 1,632 478 1,153
Notes: See Table I for variables definitions. Robust standard errors in parentheses.  ,  and  denote significance at 1, 5 and 10% levels, respectively
 Table VII Robustness check of female CEOs and firm value using alternative proxy of firm value
ROE ROA
(1) (2) (3) (4) (5) (6)
Variables Full sample SOE SOE Full sample SOE NSOE

FCEOs 0.134 (0.0467) 0.0395 (0.0315) 0.210 (0.0689) 0.0205 (0.0129) 0.00442 (0.0185) 0.0168 (0.0176)
BSize 0.0114 (0.00538) 0.0128 (0.0120) 0.0121 (0.00508) 0.000414 (0.00141) 0.000489 (0.00247) 0.000416 (0.00155)
Indep 0.0224 (0.0611) 0.00662 (0.0846) 0.0504 (0.0832) 1.16e-05 (0.0132) 0.0138 (0.0198) 0.00721 (0.0167)
Duality 0.0134 (0.0100) 0.00746 (0.00899) 0.0101 (0.0312) 0.00134 (0.00253) 0.00548 (0.00207) 0.00365 (0.00762)
Cap 0.442 (0.0961) 0.0405 (0.151) 0.587 (0.119) 0.0745 (0.0284) 0.0659 (0.0514) 0.112 (0.0347)
TA 0.0199 (0.00545) 0.0147 (0.00780) 0.0253 (0.00703) 0.0104 (0.00178) 0.0106 (0.00217) 0.0112 (0.00230)
Tang 0.144 (0.0445) 0.117 (0.0719) 0.175 (0.0549) 0.0753 (0.00948) 0.0764 (0.0176) 0.0778 (0.0114)
Sale 0.0520 (0.0127) 0.0181 (0.0207) 0.0504 (0.0163) 0.0335 (0.00408) 0.0226 (0.00684) 0.0351 (0.00474)
OCF 0.794 (0.0840) 0.613 (0.150) 0.874 (0.0930) 0.391 (0.0257) 0.321 (0.0461) 0.415 (0.0306)
Lev 0.0181 (0.0449) 0.0767 (0.0594) 0.0386 (0.0581) 0.0950 (0.00950) 0.123 (0.0123) 0.0844 (0.0138)
Age 1.83e-06 (0.000363) 0.000665 (0.000565) 0.000308 (0.000414) 5.23e-05 (9.19e-05) 0.000470 (0.000156) 0.000228 (0.000134)
Years Yes Yes Yes Yes Yes Yes
Industry Yes Yes Yes Yes Yes Yes
Constant 14.05 (7.657) 23.09 (12.06) 14.77 (9.346) 10.72 (1.731) 14.17 (2.902) 10.00 (2.064)
R-squared 0.178 0.117 0.219 0.525 0.543 0.535
Observations 1,629 477 1,151 1,632 478 1,153

Notes: See Table I for variables definitions. Robust standard errors in parentheses.  , and  denote significance at 1, 5 and 10 levels, respectively

j CORPORATE GOVERNANCE j
j CORPORATE GOVERNANCE j
Table VIII Endogeneity issues
FDirectors and firm value FCEOs and firm value
Panel A Panel B
(1) (2) (3) (4) (5) (6)
Variables Full sample SOE NSOE Full sample SOEs NSOE

FDirectors 0.159 (0.0541) 0.205 (0.124) 0.332 (0.0672)

FCEO 0.614 (0.216) 0.439 (0.346) 0.855 (0.284)
BSize 0.0190 (0.0176) 0.0225 (0.0238) 0.00702 (0.0222) 0.0248 (0.0180) 0.0378 (0.0274) 0.00726 (0.0221)
Indep 0.303 (0.167) 0.259 (0.215) 0.268 (0.199) 0.263 (0.174) 0.331 (0.241) 0.267 (0.209)
Duality 0.0803 (0.0248) 0.00557 (0.0268) 0.298 (0.0889) 0.0793 (0.0250) 0.0173 (0.0275) 0.270 (0.0917)
Age 0.00614 (0.00153) 0.00232 (0.00212) 0.0100 (0.00259) 0.00530 (0.00153) 0.00177 (0.00216) 0.00872 (0.00261)
Cap 2.190 (0.537) 1.659 (0.694) 1.738 (0.663) 2.097 (0.529) 1.954 (0.698) 1.667 (0.658)
TA 0.0113 (0.0173) 0.0250 (0.0207) 0.0718 (0.0253) 0.0170 (0.0175) 0.0123 (0.0215) 0.0604 (0.0243)
Tang 1.005 (0.140) 0.521 (0.323) 1.154 (0.154) 0.945 (0.131) 0.608 (0.278) 1.076 (0.142)
Sale 0.158 (0.0448) 0.0436 (0.0783) 0.202 (0.0512) 0.158 (0.0442) 0.0682 (0.0794) 0.185 (0.0510)
OCF 4.424 (0.472) 3.673 (0.791) 4.515 (0.507) 4.351 (0.460) 3.623 (0.799) 4.477 (0.493)
Lev 0.937 (0.124) 0.802 (0.135) 1.002 (0.192) 0.890 (0.120) 0.933 (0.129) 0.843 (0.182)
Years 0.103 (0.0136) 0.0990 (0.0226) 0.0919 (0.0156) 0.106 (0.0137) 0.0982 (0.0224) 0.0985 (0.0159)
Industry 0.0325 (0.00457) 0.0174 (0.00754) 0.0339 (0.00526) 0.0318 (0.00443) 0.0220 (0.00717) 0.0306 (0.00532)
Constant 206.7 (27.46) 198.1 (45.52) 185.1 (31.40) 213.4 (27.65) 196.5 (45.10) 197.9 (32.05)
R-squared 0.304 0.227 0.352 0.308 0.226 0.349
Observations 1,408 411 996 1,408 411 996
Notes: See Table I for variables definitions. Robust standard errors in parentheses,  ,  and  denote significance at 1, 5 and 10% levels, respectively
 Table IX Robustness check using GMM model
FDirectors and firm value FCEOs and firm value
Panel A Panel B
(1) (2) (3) (4) (5) (6)
Variables Full sample SOEs NSOE Full sample SOE NSOE

Lag.Q 0.849 (0.0258) 0.920 (0.0451) 0.873 (0.0299) 0.887 (0.00799) 0.989 (0.0125) 0.967 (0.0192)
FDirectors 0.249 (0.0990) 0.0340 (0.0825) 0.177 (0.0810)
FCEOs 0.0631 (0.0301) 0.00313 (0.0289) 0.152 (0.0786)
BSize 0.00741 (0.0126) 0.0120 (0.0303) 0.0206 (0.0156) 0.0287 (0.00425) 0.0180 (0.00780) 0.0193 (0.0132)
Indep 0.193 (0.103) 0.557 (0.567) 0.110 (0.137) 0.0480 (0.0425) 0.124 (0.0449) 0.0455 (0.171)
Duality 0.0324 (0.0214) 0.00576 (0.0351) 0.0690 (0.0459) 0.0326 (0.0108) 0.0230 (0.0104) 0.0766 (0.0864)
Cap 1.704 (0.876) 0.597 (1.052) 0.811 (1.201) 0.568 (0.0552) 0.223 (0.126) 0.664 (0.442)
TA 0.0230 (0.0124) 0.0313 (0.0206) 0.0284 (0.0175) 0.0170 (0.00662) 0.0351 (0.00683) 0.0217 (0.0137)
Tang 0.642 (0.135) 0.518 (0.295) 0.511 (0.172) 0.428 (0.0413) 0.404 (0.0487) 0.722 (0.149)
Sale 0.0924 (0.0326) 0.0362 (0.0566) 0.0630 (0.0494) 0.0779 (0.0170) 0.0923 (0.0138) 0.175 (0.0332)
OCF 2.298 (0.388) 0.759 (0.391) 2.111 (0.525) 2.022 (0.104) 1.307 (0.154) 0.905 (0.362)
Lev 0.442 (0.0830) 0.0545 (0.198) 0.472 (0.107) 0.0919 (0.0371) 0.405 (0.0419) 0.262 (0.111)
Age 0.000229 (0.000785) 0.000443 (0.00118) 0.00107 (0.00128) 0.000309 (0.000293) 0.000112 (0.000193) 0.000149 (0.00109)
Constant 0.297 (0.158) 1.669 (1.388) 0.341 (0.322) 0.381 (0.0678) 0.650 (0.142) 1.457 (0.492)
Yes Yes Yes Yes Yes Yes Yes
Industry Yes Yes Yes Yes Yes Yes
Observations 1,408 411 996 1,408 411 996
Diagnostic tests
Ar(1) 5.20 1.84 4.01 5.10 2.47 3.60
Ar(2) 0.72 0.35 1.23 0.55 1.01 0.54
J-statistics 72.77 20.95 43.80 144.41 51.91 67.06
Notes: See Table I for variables definitions. Robust standard errors in parentheses; J-statistics denotes Hansen–Sargan test of over-identifying restrictions. AR(1) and AR(2) denote
Arrellano-Bond tests for serial correlation in residuals,  ,  and  denote significance at 1, 5 and 10% levels, respectively

j CORPORATE GOVERNANCE j
 Similarly, the study supports the hypothesis that female on the top position, such as CEO increase
firm value. The monitoring role of FCEO helps to limit managerial opportunism, thus increasing firm
value. The results are consistent with prior studies, suggesting that firms with female leaders
perform better than male leaders (Healy and Palepu, 2001; Peni, 2014; Smith et al., 2006).
Finally, the findings show that the impacts of FDirectors and FCEO on firm value are more
pronounced for NSOE than for SOE. This association may be because of the fact that SOE
differ than NSOE in terms of social-political objective. The main aims of the SOE are to
enhance regional development, provide security to the general public and create higher
employment opportunities. Thus, our analysis suggests that FDirectors and FCEOs have the
potential to improve firm value by asserting different techniques and tools, broadened firm
image, enhance shareholder value and keep a competitive edge.
This study contributes to the literature on the determinants of firm value, and the role played
by FDirectors and FCEO in corporate decisions. To the best of our knowledge, this is the
first study in the context of Pakistan that has explored the effects of gender diversity on firm
value. Furthermore, our results contribute to the literature by showing that FDirectors play an
important role in reducing agency conflicts between shareholders and managers by
enhancing monitoring through effective governance mechanisms. Our findings also add to
the literature on the role of corporate governance in firm value and extend the literature by
suggesting that FCEOs are one of the important attributes that can monitor managers. One
interpretation of our study is that the elimination of female from the board, especially from
the top management team may lead to undesired corporate decisions.

6.2 Implications
The results regarding the relationship between FDirectors, FCEO and firm value may
provide essential implication for corporations, government, policymakers, managers and
shareholders. The government needs to legalize mandatory quota for FDirectors on the
board to encourage gender diversity, which can improve corporate governance
mechanisms. Policymakers can establish efficient and effective governance mechanisms
by encouraging female directors on corporate boards in emerging economies, like
Pakistan. Shareholders should also consider the composition of the boards, an important
factor which can benefit them by reducing the opportunistic behavior of managers. The
results also illustrate the gender diversity is less likely to play its role in SOE compared to
NSOE. Thus, our findings suggest that policymakers should devise strategies to encourage
diversity on boards of SOE, which may provide benefits in the form of high firm value.
The findings of the study also have implications for other emerging economies that seek to
identify factors which can improve corporate governance mechanisms. Our findings
provide insights that gender diversity can be at least one of the important attributes that can
enhance board dynamics, and may result in high firm value.

Notes
1. Several other studies report the importance of diversity for corporate governance (Adeabah,
Gyeke-Dako, and Andoh, 2019; Arena et al., 2015; Booth-Bell, 2018; Groening, 2019; Lin et al.,
2018; Van der Walt, Ingley, Shergill, and Townsend, 2006; Zhang, 2012).
2. www.pbc.org.pk/research-initiatives/centre-of-excellence-in-responsible-business-cerb/
3. https://pakobserver.net/women-role-in-development/
4. www.pbc.org.pk/wp-content/uploads/Baseline-Survey-on-Gender-Diversity-in-Business-Sector-of-
Pakistan.pdf
5. www.mckinsey.com/businessfunctions/

j CORPORATE GOVERNANCE j
References
Abdullah, S.N., Ismail, K.N.I.K. and Nachum, L. (2016), “Does having women on boards create value?
The impact of societal perceptions and corporate governance in emerging markets”, Strategic
Management Journal, Vol. 37 No. 3, pp. 466-476.
Adams, R.B. (2016), “Women on boards: the superheroes of tomorrow?”, The Leadership Quarterly,
Vol. 27 No. 3, pp. 371-386.
Adams, R.B. and Ferreira, D. (2004), “Gender diversity in the boardroom”, European corporate
governance institute”, Finance Working Paper, No. 57, pp. 1-30.

Adams, R.B. and Ferreira, D. (2009), “Women in the boardroom and their impact on governance and
performance”, Journal of Financial Economics, Vol. 94 No. 2, pp. 291-309.
Adeabah, D., Gyeke-Dako, A. and Andoh, C. (2019), “Board gender diversity, corporate governance and
bank efficiency in Ghana: a two stage data envelope analysis (DEA) approach”, corporate governance”,
Corporate Governance: The International Journal of Business in Society, Vol. 19 No. 2, pp. 299-320.
Adhikari, B. (2012), “Gender differences in corporate financial decisions and performance”, Available at
SSRN 2011088.
Adhikari, B.K. (2018), “Female executives and corporate cash holdings”, Applied Economics Letters,
Vol. 25 No. 13, pp. 958-963.
Adhikari, B.K. and O’Leary, V. (2011), “Gender differences in risk aversion: a developing nation’s case”,
Journal of Personal Finance, Vol. 10 No. 2, pp. 122-147.

Adhikari, B.K., Agrawal, A. and Malm, J. (2019), “Do women managers keep firms out of trouble? Evidence
from corporate litigation and policies”, Journal of Accounting and Economics, Vol. 67 No. 1, pp. 202-225.
Ahern, K.R. and Dittmar, A.K. (2012), “The changing of the boards: the impact on firm valuation of mandated
female board representation”, The Quarterly Journal of Economics, Vol. 127 No. 1, pp. 137-197.
Ahmadi, A., Nakaa, N. and Bouri, A. (2017), “Chief executive officer attributes, board structures, gender
diversity and firm performance among French CAC 40 listed firms”, Research in International Business
and Finance, Vol. 44, pp. 218-226.
Alazzani, A., Hassanein, A. and Aljanadi, Y. (2017), “Impact of gender diversity on social and
environmental performance: evidence from Malaysia”, Corporate Governance: The International Journal
of Business in Society, Vol. 17 No. 2, pp. 266-283.
Arena, C., Cirillo, A., Mussolino, D., Pulcinelli, I., Saggese, S. and Sarto, F. (2015), “Women on board:
evidence from a masculine industry”, Corporate Governance: The International Journal of Business in
Society, Vol. 15 No. 3, pp. 339-356.
Ayadi, O.F., Ojo, A.T., Ayadi, M.F. and Adetula, D.T. (2015), “Gender diversity in the governance of the
Nigerian securities market”, Corporate Governance: The International Journal of Business in Society,
Vol. 15 No. 5, pp. 734-746.
Benkraiem, R., Hamrouni, A., Lakhal, F. and Toumi, N. (2017), “Board independence, gender diversity
and CEO compensation”, Corporate Governance: The International Journal of Business in Society,
Vol. 17 No. 5, pp. 845-860.

Bennouri, M., Chtioui, T., Nagati, H. and Nekhili, M. (2018), “Female board directorship and firm
performance: what really matters?”, Journal of Banking & Finance, Vol. 88, pp. 267-291.
Bhat, K.U., Chen, Y., Jebran, K. and Bhutto, N.A. (2018), “Corporate governance and firm value: a
comparative analysis of state and non-state owned companies in the context of Pakistan”, Corporate
Governance: The International Journal of Business in Society, Vol. 18 No. 6, pp. 1196-1206.
Booth-Bell, D. (2018), “Social Capital as a new board diversity rationale for enhanced corporate
governance”, Corporate Governance: The International Journal of Business in Society, Vol. 18 No. 3,
pp. 425-439.

Borghesi, R., Chang, K. and Mehran, J. (2016), “Simultaneous board and CEO diversity: does it increase
firm value?”, Applied Economics Letters, Vol. 23 No. 1, pp. 23-26.
Brammer, S., Millington, A. and Pavelin, S. (2007), “Gender and ethnic diversity among UK corporate
boards”, Corporate Governance: An International Review, Vol. 15 No. 2, pp. 393-403.
Campbell, K. and Mı́nguez-Vera, A. (2008), “Gender diversity in the boardroom and firm financial
performance”, Journal of Business Ethics, Vol. 83 No. 3, pp. 435-451.

j CORPORATE GOVERNANCE j
 Carter, D.A. and Simkins, B.J. (2003), “Corporate governance, board diversity, and firm value”, The
Financial Review, Vol. 38 No. 1, pp. 33-53.
Carter, D.A., D’Souza, F., Simkins, B.J. and Simpson, W.G. (2010), “The gender and ethnic diversity of US
boards and board committees and firm financial performance”, Corporate Governance: An International
Review, Vol. 18 No. 5, pp. 396-414.
Catalyst (2003), “Catalyst Census of Women Board Directors of the Fortune 500, Catalyst, New York, NY.
Chapple, L. and Humphrey, J.E. (2014), “Does board gender diversity have a financial impact? Evidence
using stock portfolio performance”, Journal of Business Ethics, Vol. 122 No. 4, pp. 709-723.
Chen, J., Leung, W.S. and Evans, K.P. (2018a), “Female board representation, corporate innovation and
firm performance”, Journal of Empirical Finance, Vol. 48, pp. 236-254.
Chen, J., Dong, W., Tong, J.Y. and Zhang, F.F. (2018b), “Corporate philanthropy and investment
efficiency: empirical evidence from China”, Pacific-Basin Finance Journal, Vol. 51, pp. 392-409.
Chen, F., Hope, O.-K., Li, Q. and Wang, X. (2011), “Financial reporting quality and investment efficiency
of private firms in emerging markets”, The Accounting Review, Vol. 86 No. 4, pp. 1255-1288.
Coles, J.L., Daniel, N.D. and Naveen, L. (2008), “Boards: does one size fit all?”, Journal of Financial
Economics, Vol. 87 No. 2, pp. 329-356.
Daily, C.M., Certo, S.T. and Dalton, D.R. (1999), “A decade of corporate women: some progress in the
boardroom, none in the executive suite”, Strategic Management Journal, Vol. 20 No. 1, pp. 93-100.
Dale-Olsen, H., Schøne, P. and Verner, M. (2013), “Diversity among Norwegian boards of directors: does
a quota for women improve firm performance?”, Feminist Economics, Vol. 19 No. 4, pp. 110-135.
Dezsö, C.L. and Ross, D.G. (2012), “Does female representation in top management improve firm
performance? A panel data investigation”, Strategic Management Journal, Vol. 33 No. 9, pp. 1072-1089.
Eckbo, B.E., Nygaard, K. and Thorburn, K.S. (2016), “How costly is forced gender-balancing of corporate
boards?”, European Corporate Governance Institute (ECGI)-Finance Working Paper, No. 463.
Ellinger, A.D., Ellinger, A.E., Yang, B. and Howton, S.W. (2002), “The relationship between the learning
organization concept and firms’ financial performance: an empirical assessment”, Human Resource
Development Quarterly, Vol. 13 No. 1, pp. 5-22.
Faccio, M., Marchica, M.-T. and Mura, R. (2016), “CEO gender, corporate risk-taking, and the efficiency
of Capital allocation”, Journal of Corporate Finance, Vol. 39, pp. 193-209.
Francoeur, C., Labelle, R. and Sinclair-Desgagné, B. (2008), “Gender diversity in corporate governance
and top management”, Journal of Business Ethics, Vol. 81 No. 1, pp. 83-95.
Frye, M.B. and Pham, D.T. (2018), “CEO gender and corporate board structures”, The Quarterly Review
of Economics and Finance, Vol. 69, pp. 110-124.
Gallego-Álvarez, I., Garcı́a-Sánchez, I.M. and Rodrı́guez-Dominguez, L. (2010), “The influence of gender
diversity on corporate performance”, Revista de Contabilidad, Vol. 13 No. 1, pp. 53-88.
Ghazali, A. and Bilal, A.R. (2017), “Analyzing the link between agency problems, governance and control
attributes for Pakistan”, e-Finanse, Vol. 13 No. 3, pp. 43-65.

Green, C.P. and Homroy, S. (2018), “Female directors, board committees and firm performance”,
European Economic Review, Vol. 102, pp. 19-38.

Gregory-Smith, I., Main, B.G.M. and O’Reilly, C.A. III (2014), “Appointments, pay and performance in UK
boardrooms by gender”, The Economic Journal, Vol. 124 No. 574, pp. 109-128.

Groening, C. (2019), “When do investors value board gender diversity?”, Corporate Governance: The
International Journal of Business in Society, Vol. 19 No. 1, pp. 60-79.

Gul, F.A., Srinidhi, B. and Ng, A.C. (2011), “Does board gender diversity improve the informativeness of
stock prices?”, Journal of Accounting and Economics, Vol. 51 No. 3, pp. 314-338.

Hauser, R. (2018), “Busy directors and firm performance: evidence from mergers”, Journal of Financial
Economics, Vol. 128 No. 1, pp. 16-37.
Healy, P.M. and Palepu, K.G. (2001), “Information asymmetry, corporate disclosure, and the capital
markets: a review of the empirical disclosure literature”, Journal of Accounting and Economics, Vol. 31
Nos 1/3, pp. 405-440.

j CORPORATE GOVERNANCE j
Huse, M. and Grethe Solberg, A. (2006), “Gender-related boardroom dynamics”, Women in
Management Review, Vol. 21 No. 2, pp. 113-130.
Isidro, H. and Sobral, M. (2015), “The effects of women on corporate boards on firm value, financial
performance, and ethical and social compliance”, Journal of Business Ethics, Vol. 132 No. 1, pp. 1-19.
Javid, A.Y. (2012), “Impact of family ownership concentration on the firm’s performance (Evidence from
Pakistani Capital market)”, Journal of Asian Business Strategy, Vol. 2 No. 3, pp. 63-70.
Javid, A.Y. and Iqbal, R. (2008), “Ownership concentration, corporate governance and firm performance:
evidence from Pakistan”, The Pakistan Development Review, Vol. 47 No. 4II, pp. 643-659.
Jebran, K., Chen, S. and Tauni, M.Z. (2019), “Principal-principal conflicts and corporate cash holdings:
evidence from China”, Research in International Business and Finance, Vol. 49, pp. 55-70.
Jianakoplos, N.A. and Bernasek, A. (1998), “Are women more risk averse?”, Economic Inquiry, Vol. 36
No. 4, pp. 620-630.
Johnson, S.G., Schnatterly, K. and Hill, A.D. (2013), “Board composition beyond independence: social
capital, human capital, and demographics”, Journal of Management, Vol. 39 No. 1, pp. 232-262.
Julizaerma, M.K. and Sori, Z.M. (2012), “Gender diversity in the boardroom and firm performance of
Malaysian public listed companies”, Procedia - Social and Behavioral Sciences, Vol. 65, pp. 1077-1085.
Jurkus, A.F., Park, J.C. and Woodard, L.S. (2011), “Women in top management and agency costs”,
Journal of Business Research, Vol. 64 No. 2, pp. 180-186.
Kassinis, G. and Vafeas, N. (2002), “Corporate boards and outside stakeholders as determinants of
environmental litigation”, Strategic Management Journal, Vol. 23 No. 5, pp. 399-415.

Khan, F. and Nouman, M. (2017), “Does ownership structure affect firm’s performance? Empirical
evidence from Pakistan”, Pakistan Business Review, Vol. 19 No. 1, pp. 1-23.

Kyaw, K., Olugbode, M. and Petracci, B. (2017), “Can board gender diversity promote corporate social
performance?”, Corporate Governance: The International Journal of Business in Society, Vol. 17 No. 5,
pp. 789-802.

Larcker, D.F., Richardson, S.A. and Tuna, I. (2007), “Corporate governance, accounting outcomes, and
organizational performance”, The Accounting Review, Vol. 82 No. 4, pp. 963-1008.

Lin, T.L., Liu, H.Y., Huang, C.J. and Chen, Y.C. (2018), “Ownership structure, board gender diversity and
charitable donation”, Corporate Governance: The International Journal of Business in Society, Vol. 18 No. 4,
pp. 655-670.
Liu, C. (2018), “Are women greener? Corporate gender diversity and environmental violations”, Journal of
Corporate Finance, Vol. 52, pp. 118-142.

Liu, Y., Wei, Z. and Xie, F. (2014), “Do women directors improve firm performance in China?”, Journal of
Corporate Finance, Vol. 28, pp. 169-184.

Liu, Y., Miletkov, M.K., Wei, Z. and Yang, T. (2015), “Board independence and firm performance in
China”, Journal of Corporate Finance, Vol. 30, pp. 223-244.

Low, D.C.M., Roberts, H. and Whiting, R.H. (2015), “Board gender diversity and firm performance:
empirical evidence from Hong Kong, South Korea, Malaysia and Singapore”, Pacific-Basin Finance
Journal, Vol. 35, pp. 381-401.

Lückerath-Rovers, M. (2013), “Women on boards and firm performance”, Journal of Management &
Governance, Vol. 17 No. 2, pp. 491-509.

Majeed, M.A., Zhang, X. and Umar, M. (2018), “Impact of investment efficiency on cost of equity:
evidence from China”, Journal of Asia Business Studies, Vol. 12 No. 1, pp. 44-59.

Melero, E. (2011), “Are workplaces with many women in management run differently?”, Journal of
Business Research, Vol. 64 No. 4, pp. 385-393.
Milliken, F.J. and Martins, L.L. (1996), “Searching for common threads: understanding the multiple
effects of diversity in organizational groups”, Academy of Management Review, Vol. 21 No. 2,
pp. 402-433.

Mirza, H.H., Mahmood, S., Andleeb, S. and Ramzan, F. (2012), “Gender diversity and firm
performance: evidence from Pakistan”, Journal of Social and Development Science, Vol. 3 No. 5,
pp. 161-166.

j CORPORATE GOVERNANCE j
 Moreno-Gomez, J., Lafuente, E. and Vaillant, Y. (2018), “Gender diversity in the board, women’s leadership
and business performance”, Gender in Management: An International Journal, Vol. 33 No. 2, pp. 104-122.
Nielsen, S. and Huse, M. (2010a), “The contribution of women on boards of directors: going beyond the
surface”, Corporate Governance: An International Review, Vol. 18 No. 2, pp. 136-148.
Nielsen, S. and Huse, M. (2010b), “Women directors’ contribution to board decision-making and strategic
involvement: the role of equality perception”, European Management Review, Vol. 7 No. 1, pp. 16-29.

Peng, M.W., Bruton, G.D., Stan, C.V. and Huang, Y. (2016), “Theories of the (state-owned) firm”, Asia
Pacific Journal of Management, Vol. 33 No. 2, pp. 293-317.
Peni, E. (2014), “CEO and chairperson characteristics and firm performance”, Journal of Management &
Governance, Vol. 18 No. 1, pp. 185-205.
Perrault, E. (2015), “Why does board gender diversity matter and how do we get there? The role of
shareholder activism in deinstitutionalizing old boys’ networks”, Journal of Business Ethics, Vol. 128
No. 1, pp. 149-165.
Perryman, A.A., Fernando, G.D. and Tripathy, A. (2016), “Do gender differences persist? An examination
of gender diversity on firm performance, risk, and executive compensation”, Journal of Business
Research, Vol. 69 No. 2, pp. 579-586.
Post, C. and Byron, K. (2015), “Women on boards and firm financial performance: a meta-analysis”,
Academy of Management Journal, Vol. 58 No. 5, pp. 1546-1571.
Pucheta-Martı́nez, M.C., Bel-Oms, I. and Olcina-Sempere, G. (2018), “The association between board
gender diversity and financial reporting quality, corporate performance and corporate social

responsibility disclosure: a literature review”, Academia Revista Latinoamericana de Administracion,
Vol. 31 No. 1, pp. 177-194.
Randøy, T., Dibrell, C. and Craig, J.B. (2009), “Founding family leadership and industry profitability”,
Small Business Economics, Vol. 32 No. 4, pp. 397-407.
Ronald, J.B. (1994), “Women on corporate boards of directors: views of Canadian chief executive
officers”, Women in Management Review, Vol. 9 No. 5, pp. 3-10.
Rose, C. (2007), “Does female board representation influence firm performance? The Danish evidence”,
Corporate Governance: An International Review, Vol. 15 No. 2, pp. 404-413.

Sabatier, M. (2015), “A women’s boom in the boardroom: effects on performance?”, Applied Economics,
Vol. 47 No. 26, pp. 2717-2727.
Sajid, G., Muhammad, S., Nasir, R. and Farman, A. (2012), “Agency cost, corporate governance and
ownership structure: the case of Pakistan”, International Journal of Business and Social Sciences, Vol. 3
No. 9, pp. 268-277.
Schubert, R., Gysler, M., Brown, M. and Brachinger, H.-W. (2000), “Gender specific attitudes towards risk
and ambiguity: an experimental investigation”, Economics Working Paper Series.
Shrader, C.B., Blackburn, V. and Iles, P. (1997), “Journal of managerial issues women in management
and firm financial performance: an exploratory study”, Journal of Managerial Issues, Vol. 9 No. 3, p. 355.
Siciliano, J.I. (1996), “The relationship of board member diversity to organizational performance”, Journal
of Business Ethics, Vol. 15 No. 12, pp. 1313-1320.
Smith, N., Smith, V. and Verner, M. (2006), “Do women in top management affect firm performance? A
panel study of 2,500 Danish firms”, International Journal of Productivity and Performance Management,
Vol. 55 No. 7, pp. 569-593.
Terjesen, S., Couto, E.B. and Francisco, P.M. (2016), “Does the presence of independent and female
directors impact firm performance? A multi-country study of board diversity”, Journal of Management &
Governance, Vol. 20 No. 3, pp. 447-483.
Torchia, M., Calabrò, A. and Huse, M. (2011), “Women directors on corporate boards: from tokenism to
critical mass”, Journal of Business Ethics, Vol. 102 No. 2, pp. 299-317.

Ujunwa, A., Okoyeuzu, C. and Nwakoby, I. (2012), “Corporate board diversity and firm performance:
evidence from Nigeria”, Revista de Management Comparat International, Vol. 13 No. 4, pp. 605-620.
Vähämaa, E. (2017), “Female executives and corporate governance”, Managerial Finance, Vol. 43
No. 10, pp. 1056-1072.

j CORPORATE GOVERNANCE j
 Van der Walt, N., Ingley, C., Shergill, G. and Townsend, A. (2006), “Board configuration: are diverse
boards better boards?”, Corporate Governance: The International Journal of Business in Society, Vol. 6
No. 2, pp. 129-147.
Walls, J.L., Berrone, P. and Phan, P.H. (2012), “Corporate governance and environmental performance:
is there really a link?”, Strategic Management Journal, Vol. 33 No. 8, pp. 885-913.

Wintoki, M.B., Linck, J.S. and Netter, J.M. (2012), “Endogeneity and the dynamics of internal corporate
governance”, Journal of Financial Economics, Vol. 105 No. 3, pp. 581-606.
Yasser, Q.R. and Mamun, A.A. (2016), “The relationship between board leadership structure and
earnings management in Asia-Pacific”, Accounting Research Journal, Vol. 29 No. 4, pp. 413-428.
Yermack, D. (1996), “Higher market valuation of companies with a small board of directors”, Journal of
Financial Economics, Vol. 40 No. 2, pp. 185-211.
Zainab, Q., Ali, L. and Rehman, B. (2016), “Gender diversity in the boardroom and firm performance:
evidence from Pakistan”, Palgo Journal of Education Research, Vol. 4 No. 5, pp. 217-224.
Zhang, L. (2012), “Board demographic diversity, independence, and corporate social performance”,
Corporate Governance: The International Journal of Business in Society, Vol. 12 No. 5, pp. 686-700.

Zhu, J., Ye, K., Tucker, J.W. and Chan, K.J.C. (2016), “Board hierarchy, independent directors, and firm
value: evidence from China”, Journal of Corporate Finance, Vol. 41, pp. 262-279.

Further reading
Adams, R.B., Hermalin, B.E. and Weisbach, M.S. (2010), “The role of boards of directors in corporate
governance: a conceptual framework and survey”, Journal of Economic Literature, Vol. 48 No. 1, pp. 58-107.
Conyon, M.J. and He, L. (2017), “Firm performance and boardroom gender diversity: a quantile
regression approach”, Journal of Business Research, Vol. 79, pp. 198-211.
Du, J., Li, W., Lin, B. and Wang, Y. (2018), “Government integrity and corporate investment efficiency”,
China Journal of Accounting Research, Vol. 11 No. 3, pp. 213-232.
McGuinness, P.B., Lam, K.C.K. and Vieito, J.P. (2015), “Gender and other major board characteristics in
China: explaining corporate dividend policy and governance”, Asia Pacific Journal of Management,
Vol. 32 No. 4, pp. 989-1038.
Nekhili, M., Chakroun, H. and Chtioui, T. (2018), “Women’s leadership and firm performance: family
versus nonfamily firms”, Journal of Business Ethics, Vol. 153 No. 2, pp. 291-316.

Saat, N.A.M., Karbhari, Y., Heravi, S. and Nassir, A.M. (2011), “Effective oversight roles of board of
directors – the case of listed firms on Bursa Malaysia”, World Review of Business Research, Vol. 1 No. 1,
pp. 231-245.

Corresponding author
Irfan Ullah can be contacted at: irfanbuneri524@hotmail.com

For instructions on how to order reprints of this article, please visit our website:
www.emeraldgrouppublishing.com/licensing/reprints.htm
Or contact us for further details: permissions@emeraldinsight.com

j CORPORATE GOVERNANCE j

View publication stats