New research from emlyon Business School shows that gender diversity in boards is negatively affected by major economic crises
Shibashish Mukherjee is Professor of Corporate Finance and Sorin M.S. Krammer, at Surrey Business School investigated corporate boards both before and after 2008-2010’s financial crisis.
The study found that gender diversity in corporate boards declined significantly after the crisis. This was true irrespective of board position, expertise and firm performance. The study revealed that female junior executives were removed from corporate boards even if they held specialized positions, like CFO.
In times of crisis, firms must prioritise legitimacy and saliency differently from ‘normal’ days. This shifts the corporate focus from’softer issues’ such as gender equality to navigate the crisis as robustly and effectively as possible, says Professor Shibashish.
The researcher looked at whether a woman leader, like a CEO, or affirmative policies that are gender specific, such board gender quotas could have lessened the negative impact of the crisis. The study reveals that neither factor prevented a company from reducing gender diversity in its boards.
These results are interesting because they show that women who lead in the workplace can make progress towards equality. Women face many challenges when it comes to climbing up the corporate ladder. In times of crisis, the focus on equality for women, including female CEOs, is significantly reduced, says Professor Shibashish Mukerjee.
Researchers analysed more than 10000 corporate boards from 21 countries using a method called a “natural experimental” which compares gender diversity on board before and after global financial crisis.
The Leadership Quarterly, an academic journal, published the study.
Economic crises lead to a reduction in gender diversity at corporate boards was originally published on Human Resources News.
