Women on boards

Recently there has been talk about the role of women in business and the number of them in senior management positions and on company boards. For example, the TVNZ website has reported that

The Chair of New Zealand Global Women, Dame Jenny Shipley, said the NZX needs to follow its Australian counterparts immediately and enforce reporting on how many women sit in boards in New Zealand.

"It is time. We said last year that we would accept nothing less from the NZX than transparent public reporting on diversity. We say today they need to do it now," she said.

In Australia, evidence shows reporting on how many women sit in boards has helped boost the number of women in management and governance roles, according to the group.

Earlier this year a working paper came out on Women on Boards and Firm Performance: What Exactly Constitutes a 'Critical Mass'? Utilising a panel data set of 151 listed German firms for the years 2000-2005, the paper's authors explore the link between gender diversity and firm performance. The interesting result is that the relationship appears to be "U" shaped so that, controlling for reversed causality, they find that gender diversity at first negatively affects firm performance and only after a certain point is it associated with higher firm performance than completely male dominated boards.

The point at which all male boards are out preformed is estimated to be 30% female representation.