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Journal of Business Ethics
Published in: Journal of Business Ethics 2/2020

06-02-2019 | Original Paper

The Influence of Corporate Elites on Women on Supervisory Boards: Female Directors’ Inclusion in Germany

Authors: Jie Huang, Marjo-Riitta Diehl, Sandra Paterlini

Published in: Journal of Business Ethics | Issue 2/2020

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Abstract

Although we can observe noticeable progress in gender diversity on corporate boards, these boards remain far from gender balanced. Our paper builds on social identity theory to examine the impact of corporate elites—men and women who sit on multiple corporate boards—on board diversity. We extend the main argument of social identity theory concerning favouritism based on homophily by suggesting that boards with men with multiple appointments are unwilling to include female board members to protect the monopoly value generated by their elite status. The empirical analysis, based on DAX 30 firms in the period of 2010–2015, shows that the presence of multi-board men is negatively associated with women’s participation, while the presence of multi-board women and other women on management boards is positively related to gender diversity on boards. Furthermore, robustness tests support and confirm our conclusion that multi-board men have a significant association with board diversity, even with small size (i.e. 1 or 2). Additionally, we find a significant effect arising from pressure related to the introduction of gender quotas in Germany, effective in 2016, indicating the effectiveness of gender quota policies for board gender diversity.
previous article The Corporate Board Glass Ceiling: The Role of Empowerment and Culture in Shaping Board Gender Diversity

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Appendix
Available only for authorised users
Footnotes
1
Institutional Shareholder Services Inc. (ISS) is the world’s leading provider of corporate governance and responsible investment solutions.
 
2
Bonacich power (beta centrality) centrality, another centrality measure in social network analysis, is also used for robustness checks (Bonacich 1987).
 
3
The reason why we have only 170 observations is the following: ROA data are missing for Commerzbank AG in 2010 and 2013, for Deutsche Bank AG in 2015 and for Fresenius Medical Care AG and Co KGaA in 2013 (altogether 4 missing observations). Further, foreign sales data are missing for Linde AG for all the sample years (altogether 6 missing observations). In total, 10 observations out of 180 are missing.
 
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Metadata
Title
The Influence of Corporate Elites on Women on Supervisory Boards: Female Directors’ Inclusion in Germany
Authors
Jie Huang
Marjo-Riitta Diehl
Sandra Paterlini
Publication date
06-02-2019
Publisher
Springer Netherlands
Published in
Journal of Business Ethics / Issue 2/2020
Print ISSN: 0167-4544
Electronic ISSN: 1573-0697
DOI
https://doi.org/10.1007/s10551-019-04119-6

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