How Much Does the Board Composition Matter? The Impact of Board Gender Diversity on CEO Compensation
Abstract
The notion that female directors are better disposed to protect shareholders’ interests has brought boardroom gender diversity into the limelight. Echoing these emerging trends, this paper analyzes the relationship between board gender diversity, i.e., proportion of female directors on the corporate board, and Chief Executive Officer’s (CEO) compensation. Consistent with conjecture, the analysis suggests that large and diversified corporate boards are the main determinants of CEO compensation. Furthermore, longer-tenured CEOs who also serve as board chairperson receive higher total compensation and bonuses than their counterparts do. Into the bargain are corporate performance proxied by return of assets (ROA) and firm attributes, i.e., firm size and institutional ownership, which have divergent but direct implications for CEO compensation.
DOI
10.3390/su141811719
Publication Date
2022-09-19
Publication Title
Sustainability
Volume
14
Issue
18
Publisher
MDPI AG
ISSN
2071-1050
Embargo Period
2024-11-19
First Page
11719
Last Page
11719
Recommended Citation
Nawaz, T. (2022) 'How Much Does the Board Composition Matter? The Impact of Board Gender Diversity on CEO Compensation', Sustainability, 14(18), pp. 11719-11719. MDPI AG: Available at: https://doi.org/10.3390/su141811719
