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Gender diversity in leadership: empirical evidence on firm credit risk

Aguir, I., Boubakri, N., Marra, M. and Zhu, L. (2023) Gender diversity in leadership: empirical evidence on firm credit risk. Journal of Financial Stability, 69. 101185. ISSN 1572-3089

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To link to this item DOI: 10.1016/j.jfs.2023.101185


We study the relation between firm financial stability and gender diversity in leadership and highlight its dependence on the initial financial conditions of the firm and the role played by the women leaders. Consistent with the glass cliff and the upper echelon theories, we find that close-to-default firms are more likely to appoint women top executives and that under their leadership, subsequent firms’ risk of default decreases in the short to medium term. In parallel, independent women directors are not associated with firms’ past credit risk, and their presence is more likely to increase the firm’s subsequent default risk, as established by the tokenism and signaling theory. Our results are robust to alternative specifications and endogeneity corrections.

Item Type:Article
Divisions:Henley Business School > ICMA Centre
ID Code:113535

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