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Why So Few Women on Boards of Directors? Empirical Evidence from Danish Companies 1997-2007

Author

Listed:
  • Parrotta, Pierpaolo

    (University of Siena)

  • Smith, Nina

    (Aarhus University)

Abstract

This paper analyzes the determinants of women on the boards of directors based on a panel sample of all Danish companies in the private sector with more than 50 employees. The share of women on the boards of directors was 12 percent in 2007 and has only slowly increased during the period 1997-2007. We test three hypotheses on female board representation which we denote the female-led hypothesis, the tokenism hypothesis, and the pipeline hypothesis, respectively. Based on fixed effects estimation we find that the female-led hypothesis cannot be supported. Firms with a female chairman of the board of directors tend to have significantly fewer other non-staff board members. We find clear evidence of a tokenism behavior in Danish companies. Having one non-staff woman on the board is negatively related to the chance of hiring another woman for the board of directors. Finally, the pipeline hypothesis is partly confirmed. The share of women among the group of CEOs and VPs from other firms in the industry is positively related to having a women on the board.

Suggested Citation

  • Parrotta, Pierpaolo & Smith, Nina, 2013. "Why So Few Women on Boards of Directors? Empirical Evidence from Danish Companies 1997-2007," IZA Discussion Papers 7678, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp7678
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    References listed on IDEAS

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    1. Nina Smith, 2018. "Gender quotas on boards of directors," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-10, December.
    2. David Bjerk, 2008. "Glass Ceilings or Sticky Floors? Statistical Discrimination in a Dynamic Model of Hiring and Promotion," Economic Journal, Royal Economic Society, vol. 118(530), pages 961-982, July.
    3. Alison Sheridan & Gina Milgate, 2005. "Accessing Board Positions: a comparison of female and male board members’ views," Corporate Governance: An International Review, Wiley Blackwell, vol. 13(6), pages 847-855, November.
    4. Muriel Niederle & Lise Vesterlund, 2007. "Do Women Shy Away From Competition? Do Men Compete Too Much?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(3), pages 1067-1101.
    5. Smith, Nina & Smith, Valdemar & Verner, Mette, 2011. "Why Are So Few Females Promoted into CEO and Vice-President Positions? Danish Empirical Evidence 1997-2007," IZA Discussion Papers 5961, Institute of Labor Economics (IZA).
    6. David Bjerk, 2008. "Glass Ceilings or Sticky Floors? Statistical Discrimination in a Dynamic Model of Hiring and Promotion," Economic Journal, Royal Economic Society, vol. 118(530), pages 961-982, July.
    7. Adams, Renée B. & Ferreira, Daniel, 2009. "Women in the boardroom and their impact on governance and performance," Journal of Financial Economics, Elsevier, vol. 94(2), pages 291-309, November.
    8. Paul Dunn, 2012. "Breaking the boardroom gender barrier: the human capital of female corporate directors," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 16(4), pages 557-570, November.
    9. Renée B. Adams & Daniel Ferreira, 2007. "A Theory of Friendly Boards," Journal of Finance, American Finance Association, vol. 62(1), pages 217-250, February.
    10. Craig Peterson & James Philpot, 2007. "Women’s Roles on U.S. Fortune 500 Boards: Director Expertise and Committee Memberships," Journal of Business Ethics, Springer, vol. 72(2), pages 177-196, May.
    11. Nina Smith & Valdemar Smith & Mette Verner, 2013. "Why are So Few Females Promoted into CEO and Vice President Positions? Danish Empirical Evidence, 1997–2007," ILR Review, Cornell University, ILR School, vol. 66(2), pages 380-408, April.
    12. Val Singh & Susan Vinnicombe, 2004. "Why So Few Women Directors in Top UK Boardrooms? Evidence and Theoretical Explanations," Corporate Governance: An International Review, Wiley Blackwell, vol. 12(4), pages 479-488, October.
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    Cited by:

    1. Schank, Thorsten & Bossler, Mario & Mosthaf, Alexander, 2016. "More female manager hires through more female managers? Evidence from Germany," VfS Annual Conference 2016 (Augsburg): Demographic Change 145733, Verein für Socialpolitik / German Economic Association.
    2. MORIKAWA Masayuki, 2014. "What Types of Company Have Female and Foreign Directors?," Discussion papers 14032, Research Institute of Economy, Trade and Industry (RIETI).
    3. Masayuki Morikawa, 2014. "What Types of Companies Have Female and Foreign Directors?," AJRC Working Papers 1404, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University.
    4. Isabel Fernandez-Mateo & Roberto M. Fernandez, 2016. "Bending the Pipeline? Executive Search and Gender Inequality in Hiring for Top Management Jobs," Management Science, INFORMS, vol. 62(12), pages 3636-3655, December.
    5. Beatrice Sarpong-Danquah & Prince Gyimah & Richard Owusu Afriyie & Albert Asiama, 2018. "Corporate Governance and Firm Performance: An Empirical Analysis of Manufacturing Listed Firms in Ghana," Accounting and Finance Research, Sciedu Press, vol. 7(3), pages 111-111, August.
    6. Morikawa, Masayuki, 2016. "What types of companies have female directors? Evidence from Japan," Japan and the World Economy, Elsevier, vol. 37, pages 1-7.
    7. Lending, Claire Crutchley & Vähämaa, Emilia, 2017. "European board structure and director expertise: The impact of quotas," Research in International Business and Finance, Elsevier, vol. 39(PA), pages 486-501.

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    More about this item

    Keywords

    tokenism; female-led; gender gap; board of directors; pipeline;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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