Impact of gender diversity on firm performance: empirical evidence from India

Abstract

Purpose The main purpose of the study is to investigate the impact of gender diversity both at the board and workforce level on firm performance (FP) in the Indian context. Design/methodology/approach This study is based on annual data of 200 companies listed on Bombay Stock Exchange (BSE) for the period 2012–2019. The authors have used the fixed-effects (FE) regression and system generalized method of moments to estimate the impact of board gender diversity and workforce gender diversity (WGD) on FP. The authors have used Blau's Index (BI) and Shannon's Index (SI) to measure gender diversity. Further, the authors have used return on assets and Tobin's Q (TBQ) to measure FP. Findings The authors' panel regression results suggest that board gender diversity and WGD have a positive and statistically significant impact on FP. The authors' findings are robust across different methods of estimation and alternative measures of FP. Originality/value This paper examines the impact of gender diversity both at the board and workforce level on FP of 200 companies listed on BSE. The authors' study contributes to the literature that is sparse in the Indian context and provides new insights on the impact of board and WGD on FP. The findings have useful policy implications. To achieve better performance, it is imperative to appreciate gender diversity at the governance and workforce level in a fast-growing economy like India.