Business Strategy
Promoting Gender Diversity in the Boardroom: Exploring Multiple Perspectives

Article Details
Pub. Date : Mar' 2019
Product Name : The IUP Journal of Business Strategy
Product Type : Article
Product Code : IJBS41903
Author Name : Shreya Sharda
Availability : YES
Subject/Domain : Management
Download Format : PDF Format
No. of Pages : 26

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Abstract

Gender diversity has been the most researched aspect of board diversity, which consists of other observable dimensions like age, ethnicity and unobservable dimensions like attitudes and backgrounds. The possibility of women breaking the proverbial ‘glass ceiling’ to occupy senior leadership roles is still considered low in countries around the world, the underlying reason being the larger issue of gender inequality. A large body of academic literature has examined the relationship between the presence of women directors on boards and its impact on financial performance of an entity or firm value. Many of these studies have reported positive associations, contrarily some studies have found evidence of no significant relationship or a negative gender diversity-firm performance relationship. Yet another stream of research focuses on theoretical perspectives and characteristics of women on corporate boards. The objective of this paper is to assess the ‘business case for diversity’ and to review significant studies related to this theme. It considers multiple perspectives on gender diversity along with global contemporary research. The paper also puts forth the varied legislative initiatives adopted by different countries to address the under-representation of women in business. Broadly, the literature reviewed appears to support the ‘business case’ which suggests that greater gender diversity has a positive impact on financial performance. However, a closer look reveals that the direction of the gender diversity-firm performance relationship is affected by methodological issues, mediating variables/processes and contextual factors.


Description

Diversity was ranked as the top trend concerning the state of hiring as per LinkedIn’s Global Recruiting Trends Report, 2018, ahead of data and Artificial Intelligence (AI). The report states that diversity, inclusion and belonging are directly tied to company culture and performance. It is based on a survey of more than 8,000 recruiters across the world. At the broadest level, diversity refers to “the great number of different statuses among which a population is distributed” (Blau, 1977). These ‘statuses’ include differences in gender, ethnicity, age, educational qualifications as well as differences in attitudes and backgrounds (Robinson and Dechant, 1997). With regard to board diversity, it is the variety inherent in the board’s composition and is increasingly regarded as a crucial aspect of board composition (Campbell and Mínguez-Vera, 2008).


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