From zero to Hero: effect of gender diversity on corporate social performance in Brazil

Abstract

Purpose: The purpose of this study is to examine the effect of board gender diversity on corporate social performance (CSP) in Brazilian companies. Design/methodology/approach: This research collected available information on the CSP, financial performance and governance of Brazilian companies for five years (2016–2020). The dependent variable of this study is CSP (workforce, human rights, community and respect for the product). The independent variable is gender diversity. The authors control financial performance, the presence of a social responsibility committee and the industry sector. The data were analyzed using the dynamic panel data system, which is the generalized method of moments (GMM) estimator. Findings: This empirical investigation confirmed the hypothesis that the female presence on boards has a positive effect on the CSP of Brazilian companies. The findings of this study are consistent with previous studies. The authors' results suggest that women are more socially aware and exhibit more social corporate behavior. Practical implications: Supplementing financial reports with nonfinancial information draws the attention of regulators and shareholders. Companies can also create human resources policies for appointing women to senior management positions and a succession plan that values the talent that women bring to companies. Originality/value: A critical mass of women on the board can provide an effective balance, considering the diversity of backgrounds and experiences between men and women. Just one woman on the board can mean representation and resistance, but with a critical amount, female directors can have a voice and help formulate strategies aimed at CSP.