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The Influence of Board Diversity, Board Diversity Policies and Practices, and Board Inclusion Behaviors on Nonprofit Governance Practices

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  • Kathleen Buse
  • Ruth Bernstein
  • Diana Bilimoria

Abstract

This study examines how and when nonprofit board performance is impacted by board diversity. Specifically, we investigate board diversity policies and practices as well as board inclusion behaviors as mediating mechanisms for the influence of age, gender, and racial/ethnic diversity of the board on effective board governance practices. The empirical analysis, using a sample of 1,456 nonprofit board chief executive officers, finds that board governance practices are directly influenced by the gender and racial diversity of the board and that board inclusion behaviors together with diversity policies and practices mediate the influence of the board’s gender and racial diversity on internal and external governance practices. Additionally, we found an interaction effect that indicates when boards have greater gender diversity, the negative impact of racial diversity on governance practices is mitigated. The findings suggest that board governance can be improved with more diverse membership, but only if the board behaves inclusively and there are policies and practices in place to allow the diverse members to have an impact. Copyright Springer Science+Business Media Dordrecht 2016

Suggested Citation

  • Kathleen Buse & Ruth Bernstein & Diana Bilimoria, 2016. "The Influence of Board Diversity, Board Diversity Policies and Practices, and Board Inclusion Behaviors on Nonprofit Governance Practices," Journal of Business Ethics, Springer, vol. 133(1), pages 179-191, January.
    • Handle: RePEc:kap:jbuset:v:133:y:2016:i:1:p:179-191
    DOI: 10.1007/s10551-014-2352-z
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    Citations

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    Cited by:

    1. Tasawar Nawaz, 2022. "What's in an education? Implications of CEO education for financial inclusion," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 3741-3753, July.
    2. Elliroma Gardiner, 2024. "What’s age got to do with it? The effect of board member age diversity: a systematic review," Management Review Quarterly, Springer, vol. 74(1), pages 65-92, February.
    3. Li, Huafang, 2019. "Communication for Coproduction: A Systematic Review and Research Agenda," OSF Preprints y4q9v, Center for Open Science.
    4. Doaa Aly & Muath Abdelqader & Tamer K. Darwish & Arshad Hasan & Anna Toporkiewicz, 2024. "How organizational board compositions lead to a higher job satisfaction: an empirical analysis of US and UK companies," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 21(2), pages 277-289, June.
    5. Ha Thanh Nguyen & Balachandran Muniandy, 2021. "Gender, ethnicity and stock liquidity: evidence from South Africa," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 61(S1), pages 2337-2377, April.
    6. Alessandro Hinna & Fabio Monteduro, 2017. "Boards, governance and value creation in grant-giving foundations," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 21(4), pages 935-961, December.
    7. Elmagrhi, Mohamed H. & Ntim, Collins G. & Wang, Yan & Elamer, Ahmed A. & Crossley, Richard, 2021. "The effect of vice-chancellor characteristics and internal governance mechanisms on voluntary disclosures in UK higher education institutions," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 45(C).
    8. Ruth Sessler Bernstein & Morgan Bulger & Paul Salipante & Judith Y. Weisinger, 2020. "From Diversity to Inclusion to Equity: A Theory of Generative Interactions," Journal of Business Ethics, Springer, vol. 167(3), pages 395-410, December.
    9. Mary Jane Lenard & E. Anne York & Bing Yu, 2019. "Female Trustees and University Financial Performance," International Journal of Economics and Financial Issues, Econjournals, vol. 9(6), pages 60-66.
    10. Nazliben, Kamil Korhan & Renneboog, Luc & Uduwalage, Emil, 2022. "Social Diversity on Corporate Boards in a Country Torn by Civil War," Other publications TiSEM b4180c31-8e9a-4009-8b50-1, Tilburg University, School of Economics and Management.
    11. Tasawar Nawaz, 2022. "How Much Does the Board Composition Matter? The Impact of Board Gender Diversity on CEO Compensation," Sustainability, MDPI, vol. 14(18), pages 1-15, September.
    12. Veena L. Brown & Erica E. Harris, 2023. "The Association of Female Leaders with Donations and Operating Margin in Nonprofit Organizations," Journal of Business Ethics, Springer, vol. 185(1), pages 223-243, June.
    13. Reficco, Ezequiel & Layrisse, Francisco & Barrios, Andres, 2021. "From donation-based NPO to social enterprise: A journey of transformation through business-model innovation," Journal of Business Research, Elsevier, vol. 125(C), pages 720-732.
    14. Kamil K. Nazliben & Luc Renneboog & Emil Uduwalage, 2024. "Social Diversity on Corporate Boards in a Country Torn by Civil War," Journal of Business Ethics, Springer, vol. 194(3), pages 679-706, October.
    15. Andrea Melis & Tasawar Nawaz, 2024. "The Impact of CEOs’ Personal Traits on Organisational Performance: Evidence from Faith-Based Charity Organisations," Journal of Business Ethics, Springer, vol. 190(4), pages 919-939, April.

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