Women Directors on Traditionally Male-Dominated Stock Exchange Boards: Can They Make a Difference?

Abstract

Stock exchanges are regulated markets that promote sustainable business practices, including encouraging board gender diversity among listed companies. However, despite their essential role in advancing gender diversity at board level across companies, it is surprising that little research has investigated their internal efforts in implementing such practices. To fill this gap, we examine exchanges’ board gender diversity using a unique firm-level panel dataset comprising 22 equity stock exchanges representing 53 percent of the World Federation of Exchanges’ total market capitalization covering 1995 to 2019. We find that board gender diversity increased and, drawing on resource dependence theory, we also examine its impact on performance. We find that the effect is positive, especially when women have competencies better adapted to the new exchanges’ business environment −business administration, international, and regulatory background- and when the CEO is a woman since she may legitimize those women’s contributions and enable their impact on performance.