Author(s) :

Sunaina Kanojia, Gunjan Khanna.

Volume/Issue :

Abstract :

Despite of decades of ongoing debate, there has been a little impact on corporate practices, as the representation of women serving on the corporate boards of the large, prime or most visible corporation has remained negligible across the world.To expound the longing to have gender diverse board for implementation of better corporate governance and long term survival of corporations in India.The results revealed that in context of India, women participation on corporate boards is at the stage of tokenism. Findings revealed that the provision under the Companies Act, 2013 wherein certain class of companies to have at least one woman director has eventually necessitated in India to bring any real change in the homogeneous boards and there are substantial number of hindrances for women in the form of organisational, individual and societal barriers while climbing the corporate ladder still women exhibit diverse leadership style and women’s presence leads to qualitative advancement. The analysis of data highlights that women are vigilant about all stakeholders’ interest and women are risk averse. It provides an explanation for previous inconclusive findings of studies regarding the impact of women on corporate governance by advocating the need to enhance board effectiveness as a transitional stride in understanding the effects of board on governance level outcomes.

No. of Downloads :

8

KEYWORDS:

Board Composition, Corporate Governance, Women Directors

INTRODUCTION & OBJECTIVES:

Women representation on corporate boards conceived to be the potential avenue to address the governance issues (Brown et. al. 2002 [8], Jamali et. al. 2007 [27], Adams and Ferreira 2009 [2], Terjesen et. al. 2009 [47], Ferdinand et. al. 2011 [17], Zaichkowsky 2014 [51], Lakhal et. al. 2015 [32]). The question to examine in context of corporations with diversity arises from the basic fact that when society and business is diverse, then is it rational to have board without diversity governing a business and if board is diverse then whether corporations are benefited by such diversity. (García et al 2017 [20]) discussed the conservatism and quality of reporting gets impacted by women directors in banks governance by highlighting the benefits of gender diversity and financial expertise in upholding the integrity of financial reporting. Apart from conservatism gender diversity resolves the problem of leadership shortage faced by companies across the world (Beeson and Valerio 2012 [6]) and more women are likely to be found on the boards of those companies listed for longer period (Lazzaretti et. al. 2013 [33]). Sharma (2013) [41] Lack of stringent norms in the prefecture of Corporate Governance had severe implications as demonstrated in the collapses of high profit institutions around the world such as USA (Enron, World.Com, Junk Bond Fiasco, Tyco, Waste Management, Xerox Corporation, Adelphia Communication, Andersen worldwide and Health South), U.K. (Maxwell publishing group, BCCI and Polypeck International), Germany (Holtzman, Berliner Bank and Kirch Media), Korea (Daewoo group), Australia (Ansett Airlines and One Tel), France (Credit Lyonnais and Vivendi) and Switzerland (Swissair). Contemporary discussions of corporate governance focus on gender diversity of the corporate board as board rooms worldwide continue to be monopolized by men. Women represents half of the world’s population, execute nearly two thirds of work hours, receive one tenth of the world’s income, possess less than one hundredth percent of world’s property and typical corporate boards have a majority of men as directors (Gupta 2010 [21]). Over the last decade, gender inequality in the workplace has become the focal of attention of many efforts attempting to break the glass ceiling. Women continue to be left out of management positions, despite catching up with men in the areas of educational attainment and despite laws banning discrimination in the workplace. In the corporate world, men continue to reign withmale dominated boardrooms, outnumbering women more than ten to one (GMI Rating’s 2012 [22]). The Global Financial Crisis (GFC) has provided a momentum for increasing women corporate board appointments globally. Helena Morrisey reckons that the GFC “may not have been as bad if there were more women at the top, in Mergers and Acquisitions, on the trading floors and that companies are starting to catch on”. IMF chief Christine Lagarde believes, “if the Lehman Brothers had been the Lehman Sisters, today’s economic crisis clearly would look quite different ... there were two women on the ten member board of the Lehman Brothers”. The recent shift to increasing the number of women in boardrooms subsequent to the GFC indicates the desire for a fresh direction in corporate leadership globally (Priestley A. 2012 [39]). Objectives of the study The present study seeks to critically examine the impact of women directors on corporate boards. The specific objectives of the study have been identified as follows: 1. To evaluate the relationship between the number of women on corporate boards and the characteristics of the companies during the period of the study. 2. To provide comprehensive insight into the international variations in the propositions in place and the percentage of women on corporate boards, worldwide. Women on Corporate Boards Multifaceted Challenges Organisational Factors - Glass Ceiling - Old Boys Network - Tokenism Industry Characteristics - Profitability - Size - Diversification strategy - Governance Policy Social Factors - Family Commitments - Paradox in the public attitude towards women as leader Country Level Characteristics - Cultural norms - Education level of women - Media Impact - Tolerance for inequalities in the distribution of power on the basis of gender - Government interventions Impact of Women Corporate Governance - Committed towards stakeholder interest - Board Dynamics - Assertive on governance issues - Enhanced board Independence - Conscientiously participate in the board decisions - Gender Diversity: Substitute mechanism for corporate governance - Risk Averse Financial Performance - Return on Equity - Tobins Q - Return on Assets - Stock Price Organisational Performance - Employee Productivity - Additional Human Capital - Board Strategic Control - Innovation Corporate Social Responsibility Initiatives to increase women representation Legislative Measures Regulatory Measures Mentoring Programs Voluntarily by the Companies Corporate Governance Insight, Volume:1, Number:1,May 2019, eISSN: 2582-0834 GLOBAL RESEARCH FOUNDATION FOR CORPORATE GOVERNANCE 30 3. To examine the impediments that women face during their progression to the board positions. 4. To collate empirical evidence towards the impact of women on corporate governance of an organisation while serving the corporate boards. 5. To unearth the measures to be undertaken to increase the percentage of women on corporate boards.

DOI:

https://doi.org/10.58426/cgi.v1.i1.2019.27-53