Board diversity in the United Kingdom and Norway: an exploratory analysis

Abstract

This paper examines the evolving pattern of gender diversity of the boards of directors of leading Norwegian and British companies on a longitudinal basis. The period covered by the study covers the run up to proposed affirmative action legislation in Norway and, as such, affords an insight into corporate actions in this emerging institutional context. The findings demonstrate that, while board diversity has grown substantially in both countries in recent years, it has done so considerably more rapidly in Norway than in the United Kingdom. The analysis highlights the sectoral variation between the countries in the pattern and growth of board diversity and suggests that the vast majority of the overall growth in board diversity is the result of changing firm behaviour rather than sectoral shift in the United Kingdom or Norwegian economies. It is also shown that as diversity has increased there has been no fall in how experienced female directors are; neither is there evidence of a rise in the number of boards that female directors sit on. This suggests that the rapid growth in board diversity has been achieved without any fall in the quality of female directors.

The gender gap in pay in company boards

“…Thus, even though the regulations have been introduced, the time permitted for 20 reaching gender equality is long (8 years) and for this reason, it may be possible that companies are not in a hurry to reach the gender quota of 40%. In any case, we agree with Grosvold et al (2007), who argue that a compulsory gender quota (affirmative action programs) may have the potential to generate growth in female representation in the boardroom and report that no negative effects of this initia-…”

The Effect of Board Diversity on the Performance of Banks: Evidence from Turkey

“…Board members not originating from the traditional "old boys' club" may adopt the norms and behaviors of the conventional board members (Rose, 2003). For instance, a token woman may feel marginal to the decision-making process and unable to voice her own views and opinions, contrary to expectations (Grosvold, Brammer, & Rayton, 2007).…”

“…Spain has also followed Norway's lead by introducing a law that requires a 40% quota of female directors by 2015 (Adams & Ferreira, 2009). Most of these legislations will equalize and strengthen the position of women in the boardroom and improve corporate governance (Grosvold et al, 2007). Hence, policymakers in Turkey should pay attention to the effect of mandated reforms regarding board diversity and may choose to apply affirmative action programs to create more diverse boards of directors.…”

“…Turkey is one of the countries with a low percentage of female representation on boards. Affirmative programs have the potential to increase the number of females in boardrooms (Grosvold et al, 2007). For instance, Norway enacted laws to foster the presence of women directors on boards.…”

Female directors and earnings management: Evidence from UK companies

“…This gradual shift in recognising the role of female in the corporate board was evident in Grosvold et al (2007) which noticed the presence of female directors in UK FTSE 100 companies raised from 4.5 per cent in 1999 to 10.5 per cent in 2005. Table III shows the highest propotion of NFAM (12 per cent) and INFAM (6 per cent) in 2011.…”