Do women in top management affect firm performance? Evidence from Indonesia

Darmadi, S

Do women in top management affect firm performance? Evidence from Indonesia

Darmadi, S

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Publisher:: Emerald
Publication Type:: Journal Article
Citation:: Corporate Governance (Bingley), 2013, 13, (3), pp. 288-304
Issue Date:: 2013-06-01

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Field	Value	Language
dc.contributor.author	Darmadi, S https://orcid.org/0000-0002-7705-2672
dc.date.accessioned	2021-09-16T11:19:21Z
dc.date.available	2021-09-16T11:19:21Z
dc.date.issued	2013-06-01
dc.identifier.citation	Corporate Governance (Bingley), 2013, 13, (3), pp. 288-304
dc.identifier.issn	1472-0701
dc.identifier.uri	http://hdl.handle.net/10453/150600
dc.description.abstract	Purpose: The purpose of this paper is to examine the relationship between gender diversity on the management board and the financial performance of Indonesian listed companies. Design/methodology/approach: Cross-sectional regression analysis was conducted based on a sample comprising 92.4 percent of public firms listed on the Indonesia Stock Exchange (IDX). The dependent variable was firm performance, measured by return on assets (ROA) and Tobin's q. The explanatory variable was gender diversity, proxied by the proportion of women, the presence of women, and a gender heterogeneity index. Findings: It was found that the representation of female top executives is negatively related to both ROA and Tobin's q, suggesting that female representation is not associated with an improved level of performance. From correlation analysis, the results also reveal that smaller firms, which tend to be family-controlled, are more likely to have a higher proportion of female members on management boards. This implies that large firms are "tougher" for women in terms of opportunities to hold seats on the board. Research limitations/implications: The data only cover one single financial year (2007); hence, the results may lack generalizability. Originality/value: Studies on the relationship between board gender diversity and financial performance have been conducted in the context of a few developed economies. This study contributes to the literature by examining such an issue in a developing economy that has a different environment from that of developed economies. © Emerald Group Publishing Limited.
dc.language	en
dc.publisher	Emerald
dc.relation.ispartof	Corporate Governance (Bingley)
dc.relation.isbasedon	10.1108/CG-12-2010-0096
dc.rights	info:eu-repo/semantics/closedAccess
dc.subject	1501 Accounting, Auditing and Accountability, 1502 Banking, Finance and Investment, 1503 Business and Management
dc.subject.classification	Business & Management
dc.title	Do women in top management affect firm performance? Evidence from Indonesia
dc.type	Journal Article
utslib.citation.volume	13
utslib.for	1501 Accounting, Auditing and Accountability
utslib.for	1502 Banking, Finance and Investment
utslib.for	1503 Business and Management
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Accounting Discipline
utslib.copyright.status	closed_access	*
dc.date.updated	2021-09-16T11:19:20Z
pubs.issue	3
pubs.publication-status	Published
pubs.volume	13
utslib.citation.issue	3

Abstract:

Purpose: The purpose of this paper is to examine the relationship between gender diversity on the management board and the financial performance of Indonesian listed companies. Design/methodology/approach: Cross-sectional regression analysis was conducted based on a sample comprising 92.4 percent of public firms listed on the Indonesia Stock Exchange (IDX). The dependent variable was firm performance, measured by return on assets (ROA) and Tobin's q. The explanatory variable was gender diversity, proxied by the proportion of women, the presence of women, and a gender heterogeneity index. Findings: It was found that the representation of female top executives is negatively related to both ROA and Tobin's q, suggesting that female representation is not associated with an improved level of performance. From correlation analysis, the results also reveal that smaller firms, which tend to be family-controlled, are more likely to have a higher proportion of female members on management boards. This implies that large firms are "tougher" for women in terms of opportunities to hold seats on the board. Research limitations/implications: The data only cover one single financial year (2007); hence, the results may lack generalizability. Originality/value: Studies on the relationship between board gender diversity and financial performance have been conducted in the context of a few developed economies. This study contributes to the literature by examining such an issue in a developing economy that has a different environment from that of developed economies. © Emerald Group Publishing Limited.

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http://hdl.handle.net/10453/150600