The influence of gender diverse corporate boards on employee-orientation
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The influence of gender diverse corporate boards on employee-orientation Sabrina Wieland • Benjamin S. Flavel
Ó Springer Science+Business Media New York 2014
Abstract This study takes a sample set of German publicly listed and unlisted companies between 2007 and 2011 and investigates the relationship between gender diverse corporate boards and the level of employee-orientation. From this work it is suggested that employee-orientation on the supervisory board has the potential to enhance the level of employee-orientation, in particular investments in corporate culture and secondary benefits and work-life-balance. Keywords Female Women Diversity Stakeholder Human resources Corporate governance
1 Introduction The presence of gender diversity on corporate boards has recently been discussed as an important aspect of good corporate governance (Carter et al. 2003). This is a result of a corporate board’s ability to influence major strategic decisions, with the composition of the board suggested to have significant implications for company success. Donaldson and Preston (1995) and Adams and Ferreira (2009) describe gender composition on the supervisory and executive boards as being able to strongly influence the effective execution of company goals and thereby the ultimate corporate performance. Therefore, besides attempting to maintain socially accepted male/female representation in the work force (van der Walt and Ingley 2003), a company could also have economic reasons to ensure a gender diverse corporate structure. However, despite positive arguments for gender diversity on corporate S. Wieland (&) WHU – Otto Beisheim School of Management, Burgplatz 2, 56179 Vallendar, Germany e-mail: [email protected] B. S. Flavel Institute of Nanotechnology, Karlsruhe Institute of Technology, 76021 Karlsruhe, Germany
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boards the proportion of corporate seats occupied by women remains low, worldwide (Farrell and Hersch 2005; Terjesen et al. 2009; Torchia et al. 2011). For example, in Germany the proportion of women on the executive or supervisory board in 2011 for the 200 largest companies was 3 and 12 %, respectively, with more than 2/3 of the female supervisory board seats being employee representative positions (Holst and Schimeta 2012). Combating this issue is the recent introduction of a gender quota by several European countries, such as Norway, Spain, France, Italy, Belgium, Slovenia, and the Netherlands that is aimed at fostering opportunities for females, allowing them to reach a corporate management position. For example, in 2003, Norway became first the European country to introduce a gender quota for corporate boards, requiring that women occupy at least 40 % of the board seats for publicly listed and state-owned companies. The introduction of a gender quota has received considerable criticism from companies, which view the quota as unwanted government intervention towards achieving a socially accepted statistic and attracting more female voters. Companies also often belie
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