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Annual Review of Financial Economics

Volume 13, 2021

Diversity on Corporate Boards

Abstract

This article reviews existing research on board diversity. What role does diversity of board members play in board governance, and how does it influence firm behavior and firm value? First, given the recent focus on board diversity among institutional investors and regulators, we present stylized facts and time trends in board diversity. Second, we discuss the dimensions of diversity that have been examined in the literature. Third, we study the determinants of board diversity. Finally, we assess the research on the effects of board diversity on firm performance and outcomes. We discuss the endogeneity challenges of studying the impact of diversity on firm value and review the main approaches that existing studies have used to address endogeneity. We conclude with suggestions for future research on board diversity.

Keyword(s): board composition, board structure, corporate boards, demographic diversity, diversity, gender diversity
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2021-11-01
2024-04-19
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/content/journals/10.1146/annurev-financial-101520-065559
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Diversity on Corporate Boards
Annual Review of Financial Economics 13, 301 (2021); https://doi.org/10.1146/annurev-financial-101520-065559
/content/journals/10.1146/annurev-financial-101520-065559
/content/journals/10.1146/annurev-financial-101520-065559
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