Does Board Gender Diversity Matter for Sustainable Growth Rate? Evidence from Banking Industry in Vietnam

Abstract

—This paper examines the impact of board gender diversity on the sustainable growth rate in the banking industry. Since there is not much empirical research on the link between gender diversity and sustainable growth of banks, this is a very important step toward further understanding the impact of female directors on boards in the long run in the financial sector. Using the data of 318 bank-year observations from 30 commercial banks in Vietnam for the 2010 – 2020 period, we find that gender diversity on boards significantly contributes to banks’ sustainable growth rate. Our findings remain unchanged after taking endogeneity issues into consideration and using different measures of board gender diversity. This study adds to the existing literature regarding the banking sector and suggests that banks should concentrate their efforts on hiring more female directors.