Does board gender enhance Palestinian firm performance? The moderating role of corporate social responsibility

Abstract

Purpose This study aims to examine how the salient board gender diversity among board directors affects firm performance both directly and indirectly, through the role of corporate social responsibility (CSR) in listed firms on the Palestine Stock Exchange over the period 2010–2017. Design/methodology/approach Based on panel data of 384 observations from all firms listed on the Palestine Security Exchange during the period from 2010 to 2017, this study uses panel data regression to examine the effect of the predictors on firm performance. In addition, to mitigate the endogeneity issue, the analysis was repeated by using one-step generalized method of moments. Findings The results show that board gender diversity has a positive and insignificant influence on firm performance. However, under the moderating effect of CSR, the finding turns from positive insignificant to positive significant. Originality/value The study is timely given that gender diversity plays pivotal roles in determining the performance in terms of monitoring and controlling and further willing to engage in social responsibility. The prior research in Palestine has never investigated the effect of board gender diversity. As such, Palestine has not established a legal quota of minimum female representation on boards, and because of it, the country has weak women’s representation among firms. It, therefore, becomes a necessity to examine the influence of board gender diversity on the financial performance of listed firms in Palestine. Besides, the mixed result in previous literature on the board gender diversity and firm performance indicates that there is an indirect effect that needs alternative explanations.

Does financial performance moderate the relationship between board attributes and corporate social responsibility in French firms?

“…On one side, according to our literature review, board attributes affect largely CSR engagement (Roffia et al, 2021;Cordova et al, 2021;Nwude and Nwude, 2021;Dwekat et al, 2020;Tibiletti et al, 2021;Zaid et al, 2020;Zubeltzu-Jaka et al, 2020;Al Fadli, 2020;Gerged, 2021;Ben Fatma and Chouaibi, 2021;Shahbaz et al, 2020;Al-Mamun and Seamer, 2020;Bhuiyan et al, 2021;Chintrakarn et al, 2021;Rashid, 2021;Beji et al, 2020;Nuber and Velte, 2021;Campanella et al, 2021). On the other side, earlier researchers reported that the firm performance influences the board characteristics (Mak and Kusnadi, 2005;Valenti et al, 2011;Mak and Kusnadi, 2005;Arora and Sharma, 2015;Di Biase and Onorato, 2020;Govindan et al, 2021;Khan et al, 2021;Assenga et al, 2018;Mishra et al, 2021;Alipour et al, 2019;Saleh et al, 2021;Uyar et al, 2020). It would therefore be reasonable and expected that corporate financial performance moderates the relationship between board attributes and CSR; otherwise, the nature and sign of this relationship may vary according to firm's financial results.…”

“…3.5 Financial performance, board attributes and corporate social responsibility: moderation analysis Assuming boards have a potentially critical role to play in mitigating agency problems (Fama and Jensen, 1983;Jensen, 1993), designing and implementing strategy and fostering links between the firm and its external environment (Arora and Sharma, 2015), questions about the impact of board characteristics on firm performance have attracted significant research (Di Biase and Onorato, 2020;Govindan et al, 2021;Khan et al, 2021;Assenga et al, 2018;Mishra et al, 2021;Alipour et al, 2019;Saleh et al, 2021;Uyar et al, 2020). Findings show that the board structure and composition influence the firm financial performance.…”

Do women on corporate boardrooms have an impact on tax avoidance? The mediating role of corporate social responsibility

“…They refer to resource dependence theory (Pfeffer and Salancik, 1978) to predict the relationship between the presence of women on the board and CSR. This theory holds that more diverse boards contribute to better access to resources, reducing dependence on environmental resources, providing different points of view, advice, legitimacy, business contacts and information channels (Duppati et al , 2019; Chen et al , 2019; Chatjuthamard et al , 2021; Amorelli and García-Sánchez, 2021; Bhatt and Bhattacharya, 2015), which leads to an improvement in decision-making dynamics with respect to a firm's strategy (Kachouri et al , 2020) and favoring the practice of CSR activities (Saleh et al , 2021; Cullinan et al , 2019; Shakil et al , 2020). Within the theoretical framework of dependency theory, prior literature attested that BGD provides various perspectives, skills and values (Byron and Post, 2016) that enhance the decision-making (Fernández-Temprano and Tejerina-Gaite, 2020; Lu and Herremans, 2019; Agyei-Mensah, 2021).…”

Impact of Executive Compensation, CEO Compensation and Board Diversity on Organizational Performance with Moderating Effect of Systemic Factors

“…Third hypothesis H3a is also accepted as 0.03 is less than 0.05 which proves that board gender diversity has a significant positive impact on earnings per share. This relationship was also proved from the study conducted by Saleh et al (2021) using Palestine Stock Exchange listed firms over the period 2010-2017 and results showed that BGD has a positive and significant influence on firm performance with the moderating effect of CSR. Value of R 2 is 0.30 which means that model is fit and cumulative effect of executive compensation, CEO compensation and board gender on EPS is 30%.…”

“…The results show that the gender diversity of the board of directors has a positive and insignificant impact on company performance. However, under the moderating effect of corporate social responsibility, it was found that the change from positive insignificant to positive and significant (Saleh et al, 2021). At the same time, Oware, & Mallikarjunappa (2021) used the Indian stock market as a testing ground to study the family management, financial performance and gender diversification of listed companies.…”