The effects of boardroom gender diversity on corporate performance: empirical evidence from a sample of European listed companies

In recent decades, the contribution of board gender diversity to corporate performance has drawn the interest of policymakers and researchers. The results of recent empirical literature have established a positive relationship between gender diversity and firm performance. Nevertheless, there are arguments that gender diversity may reduce firm value. The essence of this study is to investigate the impact of board gender diversity on firms’ accounting and market-based performance using a sample of 2452 listed companies from five European countries for the period 2018–2023. The results reveal a significant positive association between the presence of women on the board (measured by the share of women directors) and corporate performance. From these findings, the higher proportion of female in boards can have a substantial impact on firm performance. Moreover, this positive influence is enhanced when a threshold of three or more female directors on board is met (critical mass). Other determinants of firm performance, such as leverage, board size, number of employees, firm size, and board independence, yield mixed significant effects on firm performance.