The pathways of board diversity in European contexts: Exploring the influence of director types on firm performance

Abstract

This research paper explores the impact of board diversity on firm performance, with a particular focus on different types of board members. The study examines gender, age, tenure, education, and nationality diversity among board members for their effects on firm performance. Using a multi-country dataset and various performance proxies, the paper employs panel regression analysis to assess the relationships. The findings reveal nuanced effects of diversity, with gender diversity among independent and non-executive directors, age diversity among executive directors, and education diversity among executives showing positive impacts. The dominant pathway among these effects is the strategic role of directors, as suggested by the resource dependence theory. However, the paper also highlights the inappropriateness of a one-size-fits-all approach to board diversity, which can have either positive or negative effects depending on the context. Overall, the research contributes to the understanding of board diversity and its implications for corporate governance and firm performance.