Women in the Board of directors : A study about their influence in the performance of organizations in Europe

Female board representation has recorded a dramatic increase at European level. In the
last decades, many firms have incorporated women as key figures and managed to
improve its profitability, while other have remained more conservative and maintained a
majority of male representation in their board of directors. Gender diversity is argued by
many to enhance profitability, as females bring forward new perspectives and
characteristics that male directors may lack, such as a higher sensibility, better problem
solving or a risk averse decision-making process. Nonetheless, the debate is still open and
there are different opinions regarding if a better performance is as a consequence of
having diverse boards. The aim of this research is to examine what kind of relationship
exists between profitability and heterogeneous boards for 110 European companies
grouped by their cultural origin. By conducting two different OLS regression models and
controlling for variables such as company size, ownership, or economic sector, a positive
but weak relationship between firm performance and female presence is found when
taking ROE as the dependent variable. On the contrary, when considering Basic EPS as
the endogenous variable, no significant relationship is found between the two variables,
and therefore performance does not appear to be influenced by a woman taking senior
roles. Furthermore, three women occupying top managing positions from the Spanish
market have been interviewed to give their opinion concerning gender diversity in the
workplace, helping to support our hypothesis and arguing whether gender diversity
enhances performance or not. Hence, this dissertation supports both ends of the academic
literature, and further areas of improvement have been outlined for future research in
order to get to know in depth what the situation is like in Europe