Blood is thicker than water: an analysis of women’s presence on Pakistani boards

Abstract

Purpose: This study aims to provide insights into gender diversity in Pakistani boardrooms, particularly for the dominant family business type, which is strongly guided by (non-financial) family-related objectives when making business decisions, such as the appointment of board members. Pakistani companies operate within the framework of weak legal institutions and a traditionally highly patriarchal environment. This study examines how corporate decisions regarding the appointment of female board members play out in this socio-political and cultural environment. Design/methodology/approach: Board composition and board characteristics were examined using hand-collected data from 213 listed family firms and non-family firms on the Pakistan Stock Exchange from 2003 to 2017. Univariate analyses, probit regressions and robustness tests were performed. Findings: Pakistani family firms have a significantly higher proportion of women on their boards than do non-family firms. They are also significantly more likely to appoint women to top positions, such as CEO or chairs. Practical implications: Evidently, women are allowed to enter boards through family affiliations. Gender quotas appear an ineffective instrument for breaking through the “glass ceiling” in this socio-cultural environment. Thus, gender parity must entail the comprehensive promotion of women and the enforcement of legal reforms for structural and cultural change. Originality/value: The analysis focuses on a Muslim-majority emerging Asian market that has been scarcely researched, thus offering new perspectives and insights into board composition and corporate governance that go beyond the well-studied Western countries.