Description

There is no specific guideline/requirement for the work. However please do note that this dissertation requires analysing the data of the gender diversity in UK firms and thereby compare its corporate performance. Tables/graph are preferred to be created for financial statement analysis. The structure should follow how a proper dissertation is done.  Research proposal as attached is just for a reference as it might not as perfect.

Research Proposal

Gender diversity and corporate performance in the United Kingdom

Research Questions

• How does increase in board gender diversity impact boards’ decision making process and corporate performance?
• What is the connection between gender diversity on top management and Corporate Social Responsibility? (Yasser, Al Mamun & Ahmed, 2017)
• How does gender act as a role to diminish the pay gap between male and female? (Boraas & Rodgers III, 2003)
• Should financial regulators in the UK commence to mandate legislation on gender quota? If so, to what extent those steps should be taken? (Kirrane, 2017).

Aims and Objectives

This paper aims to investigate the link between gender diversity on board and firm performance in the United Kingdom (Kirrane, 2017). Objectives of this paper are:

• To identify whether gender composition causes positive or negative impact to the performance of the company.
• To discover the potential benefit that could be contributed by female directors to the firm and factors that impact boardroom gender diversity (Martin et al., 2006; Kakabadse et al., 2015).
• To evaluate the relationship between Corporate Social Responsibility and gender diversity.
• To determine whether gender play a role in reducing the earnings gap (Boraas & Rodgers III, 2003).
• Critically evaluate whether financial regulators should commence raising awareness of gender diversity on board and to what extent those steps should be taken (Kirrane, 2017).

Rationales and Value of the Research

Research on board gender composition has been constantly attracting a considerable amount of attention in recent decades due to divergence in findings pertaining to the relationship between gender balance, board effectiveness and firm performance (Kakabadse et al., 2015). According to Deloitte (2019), the UK board is currently facing slow progress on improving boardroom gender diversity with 22.7% of female sitting on board and there are still 44 FTSE 350 companies falling so far short with only one or none women on their board (Hampton-Alexander Review, 2019). This phenomenon of under-represented women on high-earnings or high-status position is prevalent despite them possessing the same level of proficiency, knowledge and qualifications as their male counterparts. This is often referred to as ‘glass ceiling effect’ that restricts female from climbing the corporate ladder (Taylor & Peens, 2017).

Apart from the financial benefits by improving the productivity and profitability from increasing in gender balance, the value of the research also includes to promote women to access to more decision making positions and the ability to actively advance company strategy. It is also vital to boost global economies by having new ways of thinking that could be harnessed in creativity and innovations (Moore, 2012).

Literature Review

Mirza, Andleeb, Ramzan & Mahmood (2012) claimed that female working on top management will insinuate negative sign to the investors and lead the performance of the firm to decline. They also stated that this is due to women being emotional, aggressive, reluctant to take risk, lack of confident and some invisible barriers occurred in the society to keep women in lower position.

In contrast, both studies from Campbell & Mínguez-Vera (2007) and Agyemang-Mintah & Schadewitz (2017) proved that the appointment of female to the boardroom is the key to a firm’s success as it enhance firm’s value. Their paper also suggested that woman sitting on the board should focus on what they could contribute to the board and not be a sign of tokenism.

Due to the globalization and technology, the relationship between firms and stakeholders has been evolving and it is suggested that the board should expand their vision from the traditional shareholder focus to encompass the need of various stakeholders (Rao & Tilt, 2015). In the light of results provided by Dawar & Singh (2016) it has been shown that gender diversity causes positive impact on Corporate Social Responsibility (CSR) due to the sensitivity of women towards CSR and also their participative decision-making style.

Perryman, Fernando, & Tripathy (2016) observed that increase in gender diversity on board will not only reduce risk and improve performance, but also reduce the pay gap on the board. Carter, Franco & Gine (2017) found that female executive holds significantly lower equity incentives. Their studies further explained that female executives with risk aversion will result in gender pay gap and having more women sitting on board or as a compensation committee will reduce the gap.

It is no doubt that government has been convinced to take affirmative action to improve gender balance on board due to growing public interest in recent years. However, Labelle, Francoeur & Lakhal (2015)’s studies revealed that the mandatory approach of board gender balance will cause negative effect in both diversity and firm performance. This is due to increase in demand for additional woman representations will lead to insufficient of experienced and qualified female directors to serve in top management. Therefore, the focus should remain on recruiting the best candidate that suits the board structure under voluntarily approach rather than forcing to change quickly and coercively.

Methodology

This paper examines how gender diversity on board affects performance of UK companies for the last decade (2010 – 2020). Data on financial statements, corporate governance and individual profile of board members are collected from London Stock Exchange and Capital IQ. Apart from that, secondary data were widely used in this paper such as Hampton-Alexander Review and FRC’s Board Diversity Reporting  where they have obtained primary sources from BoardEx.

Conclusion

Kakabadse et. al. (2015) highlighted that boardroom diversity does not always directly linked to firm’s performance, but it impacts the quality of decision. Therefore, this paper focus on the benefits of gender-balanced board, and provide a greater understanding of the multiple levels of communications between social actors and structures in the study of female leadership and gender as a factor of diversity.

Structure of the dissertation

1. Introduction
   1. Research Question
   2. Aim and Objectives
   3. Rationales & Value of Research
2. Literature Review
   1. Current Status of Gender Diversity in the United Kingdom
      1. FTSE 100
      2. FTSE 250

• FTSE 350

1. Gender Diversity on Corporate Board of Directors
   1. Gender Stereotype of Woman in the Workplace
   2. Importance of Having Gender Balance on Board

• Motivation for Appointing New Female Representations

1. Corporate Social Responsibility (CSR)
2. Gender Pay Gap
3. Implementation of Regulation to Promote Gender Diversity
   1. Current Status of Legal Requirements in UK
   2. Effectiveness of Legislative Power in Other Countries

• Methods to Implement

3. Methodology
4. Findings
5. Conclusion, Discussion & Future Considerations

Reference

Agyemang-Mintah, P., & Schadewitz, H. (2017). Gender diversity and firm value: evidence from UK financial institutions. International Journal Of Accounting & Information Management, 27(1), 2-26. doi: 10.1108/ijaim-06-2017-0073

Boraas, S., & Rodgers III, W. M. (2003). How does gender play a role in the earnings gap-An update. Monthly Lab. Rev., 126, 9.

Campbell, K., & Mínguez-Vera, A. (2007). Gender Diversity in the Boardroom and Firm Financial Performance. Journal Of Business Ethics, 83(3), 435-451. doi: 10.1007/s10551-007-9630-y

Carter, M. E., Franco, F., & Gine, M. (2017). Executive gender pay gaps: The roles of female risk aversion and board representation. Contemporary Accounting Research, 34(2), 1232-1264.

Dawar, G., & Singh, S. (2016). Corporate social responsibility and gender diversity: A literature review. Journal of IMS Group, 13(1), 61-71.

Deloitte. (2019). https://www2.deloitte.com/uk/en/pages/press-releases/articles/slow-progress-for-gender-diversity-in-the-boardroom.html

Hampton-Alexander Review. (2019). FTSE Women Leaders.

Kakabadse, N., Figueira, C., Nicolopoulou, K., Hong Yang, J., Kakabadse, A., & Özbilgin, M. (2015). Gender Diversity and Board Performance: Women’s Experiences and Perspectives. Human Resource Management, 54(2), 265-281. doi: 10.1002/hrm.21694

Kirrane, S. (2017). Should financial regulators require regulated entities to have gender diversity on their boards? (Master’s dissertation, University of Warwick, Coventry, England) Retrieved from https://www.wbs.ac.uk/wbs2012/assets/PDF/downloads/mba/ptmba/Gender-diversity-on-boards.pdf

Labelle, R., Francoeur, C., & Lakhal, F. (2015). To Regulate Or Not To Regulate? Early Evidence on the Means Used Around the World to Promote Gender Diversity in the Boardroom. Gender, Work & Organization, 22(4), 339-363. doi: 10.1111/gwao.12091

Mirza, H., Andleeb, S., Ramzan, F., & Mahmood, S. (2012). Gender Diversity and Firm Performance: Evidence from Pakistan. Journal Of Social And Development Sciences, 3(5), 161-166. doi: 10.22610/jsds.v3i5.698

Perryman, A., Fernando, G., & Tripathy, A. (2016). Do gender differences persist? An examination of gender diversity on firm performance, risk, and executive compensation. Journal Of Business Research, 69(2), 579-586. doi: 10.1016/j.jbusres.2015.05.013

Rao, K., & Tilt, C. (2015). Board Composition and Corporate Social Responsibility: The Role of Diversity, Gender, Strategy and Decision Making. Journal Of Business Ethics, 138(2), 327-347. doi: 10.1007/s10551-015-2613-5

Taylor, D. & Peens, N. (2017). Gender diversity and corporate performance in South African listed companies.

Yasser, Q., Al Mamun, A., & Ahmed, I. (2017). Corporate Social Responsibility and Gender Diversity: Insights from Asia Pacific. Corporate Social Responsibility And Environmental Management, 24(3), 210-221. doi: 10.1002/csr.1400