Women on boards and bank earnings management: From zero to hero

Fan, Yaoyao, Jiang, Yuxiang, Zhang, Xuezhi and Zhou, Yue (2019) Women on boards and bank earnings management: From zero to hero. Journal of Banking & Finance, 107, [105607]. (doi:10.1016/j.jbankfin.2019.105607).

Abstract

We examine how women on boards influence bank earnings management. Using the likelihood of a board appointing women directors based on a Blau index of gender diversity in each director's total employment connections outside our sample banks for identification, we find an inverted U-shaped relation between women on boards and bank earnings management. Specifically, when there exists only a marginal number of women directors, banks are more likely to manipulate earnings. But, when the number of women directors reaches three or more, bank earnings management declines. This inverted U-shaped impact is intensified if women sit on audit or nomination committees, is moderated if women directors have higher education levels and more board experience, and is unchanged during the 2007–2009 financial crisis. Our results hold when we use alternative measures of bank earnings management, employ GMM estimations and test for alternative hypotheses for the inverted U-shaped relation.

This record has no associated files available for download.

Contributors

Author: Yue Zhou

Download statistics