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Introduction

 

Gender
equity and corporate governance has been the subject of intense research over
the last two decades.  A significant
portion has centred around examining how the gender composition of boards
affects organizational outcomes and much of that research has favoured
evaluation of the correlation between women on boards and performance
improvements in those companies.  With
respect to the impact on performance, overall the research has been equivocal
with some reporting small but positive impacts, others negative and still
others with near zero influence.

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It
is interesting to note that at the same time there have been many industry
articles and studies conducted by consulting companies such as Mckinsey and
Credit Suisse, as well as non profits like Catalyst, generally concluding that
companies who have women on the board perform better than companies with all
male boards. They typically used a variety of metrics to demonstrate this
improved performance including EBIT, stock performance and ROE but also present
other advantages of improved gender diversity including the ability to attract
top talent and improvements in employee satisfaction, customer orientation and
decision making which can lead to sustainable improvement in returns.  The end result has been these studies have
helped to reinforce the business case that the appointment of women in senior
leadership positions will lead to performance improvement in the busiensss
community. 

 

As
result or perhaps coincident with the acceptance of the performance argument, diversity
and inclusion programs have moved well beyond politically correct workplace
initiatives to become key strategic elements of corporate business plans in
support of driving employee engagement, innovation and brand development with
the expectation that these will lead to overall improvements in performance.

 

While
many corporations and their executives accept the notion that more women on
their boards lead to better performance and also cite diversity and inclusions
as key strategies, corporations have struggled to put this commitment in
practise.  In the case of women board
members as of 2016
women accounted for just 23.3%1
of board members of the largest publicly listed companies registered in EU
countries.  In the United States that How
about the US and Asia stats.

 

 

Notwithstanding
this slow progress, from a societal perspective, whether based on the business
case argument, that it is good for the bottom line or on the social justice
case, that advancing gender equity and the resulting economic empowerment of
women as a societal goal, it appears there is alignment on the objective of
gender equality and the closing of the economic opportunity gap.  Therefore it would be instructive to move
beyond looking at reasons to justify why women should be on boards and look at
the presence of women on boards and the impact that has on the advancement of
gender equity more broadly.   Specifically
how does the gender compositon of the 
board impact women leaders below the board level.

 

 

As a result we have seen many governments legistalte or are
considering legistaltion for gender quotas for publically listed
companies.  There is however serious
opposition to this strategy.

 

Objective

 

The
research proposed will pivot away from looking for rationales for women on
boards and the impact of and for women on boards to look at the wider impact
women on boards have in improving the gender diversity in their organizations
and specifically to the level of gender equity in employment levels below the
board.  This research will look at the
how setting the tone at the top provides signals to prospective and existing
employees and influences change agents both inside and outside the organization.  It will evaluate the extent of changes in the
supply side of women leaders in organizations through improvements in the pipeline
of qualified and trained leadership candidates. It will also evaluate the
impact of changes to the gender wage gap.

 

Currently
there is very little research dedicated to evaluation of the impact to gender
equity improvements as a result of having more women on boards.  There a few US based studies including…..

 

Therefore
this research should expand existing theory and research on the downstream
effects of increasing female representation on corporate boards and provide
further insight into the percentage of women on the board necessary to have
impact on that relationship to both increases of women in leadership and effect
improvements to the gender wage gap.

 

The
results can also have practical implications for legislators as they consider
the use and extension of mandated quotas as well as informing social policies
with respect to the economic empowerment of women advancing up the corporate
ladder and any impacts on progress in closing the gender wage gap.

 

The
research can also provide guidance to corporations on the impacts of the
appointment of women on boards and any impacts on their gender diversity
programs.

 

 

 

Research Questions

 

Is
greater gender diversity at the board level a driver for greater gender
diversity in management?

 

 

1.   
What is the relationship between the women on the board and
percentage of females appointed to senior leadership positions

 

 

 

2.   
Does the presence of women on the board affect the gender
wage gap?

a.   
Is there a difference in the wage gap between companies who
have higher female representation on the boards versus companies who have a
lower female representation on the board?

 

3.   
Is there a difference in the relationship of the percentage
of women on the boards and the impact on women in senior management in both
numbers and compensation

 

4.   
Do women on boards actively pursue discussions and
initiative to improve gender equity in their companies

1 European Commission Fact Sheet, 2016

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