Board Gender Diversity and Firm Performance in an Emerging Economy: The Role of Women Directors' Attributes

Abstract

Despite the extensive research on board gender diversity (BGD), questions persist regarding its impact on firm performance and the mechanisms through which it operates, especially in emerging economies. This research enhances our understanding of how the attributes of female directors contribute to firm performance. Using data from large, listed firms in Vietnam over the period 2014–2020, we find a positive effect of BGD on firm performance, with a significant impact when at least two women serve on the board. Notably, our results show that women executive directors exert a stronger positive influence than women independent directors. We also demonstrate the importance of women directors' age, rather than their education level, in shaping firm performance. Our findings are robust across various tests. Overall, this study provides compelling evidence that, in the context of emerging economies, BGD's impact on firm performance is driven by older (more experienced) women executive directors.