Does board gender diversity matter in the banking sector? Evidence from Tunisia

Abstract

The purpose of this paper is to investigate the effects of board gender diversity on banks' performance and risk for the case of a developing African country. Our sample includes a unique data set of Tunisian banks during the period 2005-2018. We use the two-way cluster regression proposed by Petersen. This approach corrects for the unobserved firm effect (time-series dependence) and time effect (cross-sectional dependence). It gives robust standard errors adjusted for heteroscedasticity, serial correlation, and cross-sectional correlation. Our results support a positive relationship between gender diversity and banks' performance measured by ROA and ROE, while women board members are associated with more default risk measured by Z-score. Our results remain robust to various measures of gender diversity, banks' performance and risk. The findings contribute to the literature by providing empirical evidence from Tunisia, an African emerging economy, where the examination of the role of board gender diversity on bank governance is unexplored. 1 | INTRODUCTION Gender equality in rights, education and employment represent most development challenges facing countries globally,

Foreign institutional ownership and bank performance: Evidence from Tunisia

“…For the board control variables, Tunisian banks have large board sizes, with an average of 11 members. The maximum board size in Tunisian legislation is 12 members (Othmani, 2021). Table 2 reports the low percentage of the independent board members with an average of 13.72%.…”

“…In line with previous works (Cheng et al, 2016;Nashier & Gupta, 2016;Othmani, 2021;Shaban & James, 2018) Tobin's Q (TOBINQ) and ROE were used as market and accounting measures of bank performance, respectively. Foreign institutional ownership (FIO) is the percentage of the holdings of foreign institutional investors.…”

Les Déterminants des Prêts Non Performants du Système Bancaire de l'UMOA

“…Othmani (2020) argumente que l'efficience managériale attribuée à la gestion bancaire, l'incompétence des dirigeants en matière de contrôle des crédits et des coûts associés constituent un facteur exogène pouvant générer des dépenses supplémentaires, diminuer la performance et augmenter les risques. En effet, la performance bancaire mesurée par le ROE (Return On Equity) ou le ROA (Return On Assets) explique le comportement à risque des gestionnaires car une rentabilité bancaire élevée peut contribuer à renforcer les fonds propres afin que la banque puisse faire face à des pertes éventuelles.…”

Gender heterogeneity and microfinance sustainability in Sub‐Saharan Africa

“…Gender diversity in the boardroom appears to be the most sought after diversity concept in the recent corporate performance literature (Othmani, 2021). The increasing attention given to board gender diversity is added to the fact that women and men react differently to issues such as risk, mutual trust and social capital endowments (Moreno‐Gomez et al, 2017).…”

“…The increasing attention given to board gender diversity is added to the fact that women and men react differently to issues such as risk, mutual trust and social capital endowments (Moreno-Gomez et al, 2017). It is believed that women take more calculated risks than men, hence reducing firms' risk exposure and strengthening their profitability and sustainability (Othmani, 2021). Furthermore, others have argued that female board members exhibit different experiences, skills and intellectual reasonings than their male counterparts.…”