Board diversity and firm effects

Abstract

This chapter proposes a systematization of the different impacts of board diversity on the firm. Since the board acts as the main governing body, its characteristics affect its way of operating and, as a consequence, its outcomes. The authors review extant literature on the various types of effects that board diversity generates in relation to the corporate social performance of the firm, the organizational performance, the firm's innovation, and the risks faced by the firm. Furthermore, the chapter provides a deeper focus on the effects of the board diversity on the firm's financial performance, being also propaedeutic to the development of a new conceptual framework proposed by the authors and illustrated in Chapter 5.