When the going gets tough: in-group bias and board gender diversity in the wake of economic shocks

Mukherjee, Shibashish and Krammer, Sorin (2022) When the going gets tough: in-group bias and board gender diversity in the wake of economic shocks. Academy of Management Proceedings, 2022 (1). (doi:10.5465/ambpp.2022.13882abstract).

Record type: Article

Abstract

Despite substantial benefits to organizations, increasing gender diversity in corporate boards remains an elusive problem due to persistent in-group biases that favor men. We engage in this conversation by probing theoretically and empirically the effects of economic shocks on board gender diversity (BGD) and the role of female leadership along with regulatory elements (i.e., gender quotas and corporate governance codes) in tackling this bias. We test our predictions using a large dataset of 6,582 firms and 45,610 observations in a quasi-experimental design that captures the heterogeneity of economic crisis in an international sample of 23 countries. Our results confirm a robust decline in BGD in the wake of an economic shock and a complex interplay between female leadership and the regulatory environment. Our findings contribute to leadership research on the bias faced by out-group minorities within organizational upper echelons and female leadership's role in dealing with pervasive organizational biases.

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