The gender gap in pay in company boards

Abstract

The aim of this study is to analyze whether a gender wage gap exists in the boards of directors (BD) of companies listed on the Madrid Stock Exchange from 2004 to 2011. 5We hypothesize that the percentage of female directors on a BD, the presence of female directors on the Nomination and Compensation Committee, the presence of wellqualified independent women directors on BD, the sector, and the geographical region, have an effect on the gender wage gap. The results show that the percentage of female directors on a BD and the geographical region have no effect on the gender 10 wage gap. On the other hand, the finding reports that women's presence on the Nomination and Compensation Committee increases the gender gap in pay, and it is reduced when there are independent female directors who have gained a degree on the BD, and when the company operates in the finance and real estate services sector. In addition, the results also demonstrate that the seniority of the female directors de-15 creases the gender gap in pay, while there is a rise when the companies are bigger and the size of the BD and the return on assets increase. These conclusions should encourage regulatory bodies to adopt forceful rules to mitigate the gender gap in pay.JEL classification: M12, M0.

Corporate governance, female directors and quality of financial information

“…). In this sense, prior evidence reports the positive effect of board gender diversity on dividend policy or fostering good corporate practice (Burgess & Tharenou , Pucheta‐Martínez & Bel‐Oms ).…”

“…Thus, this paper may provide new insights into the relationship between gender diversity on ACs and auditor reporting behaviour in the Spanish setting. On the other hand, gender diversity on boards has increased in Spain in recent years as a consequence of the continuous socio‐economic and political changes (Pucheta‐Martínez & Bel‐Oms ). This increase was made possible by the CUBG (), whose recommendations support the presence of female directors on decision‐making bodies, including ACs, and by the implementation of the LOIEMH (2007), which regulates the appointment of females and males on boards in an equitable way.…”

The Role of Rookie Female Directors in a Post‐Quota Period: Gender Inequalities within French Boards

“…Accordingly, we suspect that gender positional segregation and pay gaps within boards should be observable in most countries. Regarding compensation, studies by Pucheta‐Martinez and Bel‐Oms () (on Spain), by Gregory‐Smith, Main, and O'Reilly () (on Britain) and by Goh and Gupta () (on Britain) support this insight.…”

“…Understanding the determinants of individual board members’ compensation and raising the question of gender pay inequality are therefore of interest from a social perspective and from a corporate governance perspective. Pucheta‐Martinez and Bel‐Oms () reported on the existence of a gender gap in a sample of Spanish firms, related to two firm characteristics: the presence of female directors in the compensation committee and the industry. The studies by Gregory‐Smith, Main, and O'Reilly (), and Goh and Gupta (2015) are the most closely related to ours.…”

The gender pay gap in European executive boards: the role of executives’ pathway into the board

“…Though the gender pay gap has been intensively studied for several decades (Blau & Kahn, 2007), not much is known about gender differences in pay at top executive level. There is some evidence that there is a gender pay gap for top executives, that is, that women on boards earn less than men (Kulich, Anisman-Razin, & Saguy, 2015;Mohan, 2014;Pucheta-Mart ınez & Bel-Oms, 2015;Yanadori, Gould, & Kulik, 2016), but that for CEOs there is no or even a reverse gender pay gap (Bugeja, Matolcsy, & Spiropoulos, 2012;Gayle, Golan, & Miller, 2012). Part of the unadjusted pay gap for members of executive boards can be explained by women's selection into boards of less well-paying firms and sectors: Women tend to cluster in executive boards of smaller firms, in industries with lower executive pay levels, and in positions below the CEO level (e.g.…”