The effect of board diversity on firm capital structure and performance
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2020-07-17
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en
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Abstract
This paper examines the effect of board diversity on capital structure and firm performance. Board diversity is measured as gender diversity and the number of foreigners on the board. This effect has not been widely examined. Therefore, the analysis is performed on 5,269 European firms from 44 countries. Looking at a period of 2010-2018. Using different methods to perform the analysis, the change of reporting biased results is limited. The robust and significant results indicate that more females on the board lead to safer forms of financing and a more stable performance. Foreigners on the board, on the other hand, lead to riskier forms of financing and a more volatile performance. Additionally, some moderating effects between board diversity and corporate governance measures are found for the different forms of financing.
Keywords: board diversity, capital structure, firm performance
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Faculteit der Managementwetenschappen