۱- Introduction

۲- Data sources, sample selection and methodology

۳- Board gender composition and dividend payout

۴- The role of corporate governance

۵- Dividend initiation and re-initiation

۶- Conclusion

References

Abstract

This paper investigates whether female independent directors are more likely to impose high dividend payouts. We find evidence that firms with a larger fraction of female directors on their board have greater dividend payouts. This finding is robust to alternative econometric specifications, and alternative measures of dividend payouts and female board representation. The positive effect of board gender composition on dividends remains when we employ propensity score matching, the instrumental variable approach, and difference-in-differences approach to address potential endogeneity concerns. Furthermore, we find that board gender composition significantly increases the dividend payout only for firms with weak governance, suggesting that female directors use dividend payouts as a governance device.

Introduction

Most of the finance literature that studies gender issues focuses on the effects of female board directors on firm value, performance (see e.g. Ahern and Dittmar, 2012; Dezso and Ross, 2012; Matsa and Miller, 2013) and risk taking (see e.g. Faccio et al., 2016). Nevertheless, there is an emerging literature which studies the impact of female directors and managers on specific corporate decisions. This literature tends to concur that female directors and managers have a significant impact on these decisions. For example, firms with female directors tend to focus more on corporate social responsibility (CSR) (Shaukat et al., 2016). They are also more likely to hire female top executives (Matsa and Miller, 2011) but less likely to downsize the workforce (Matsa and Miller, 2013). Further, they are less likely to make acquisition bids and tend to make acquisitions with lower bid premiums (Levi et al., 2014). Firms with female directors however spend more on research and development (R&D) (Miller and Triana, 2009). They also take out less debt and more generally make less risky financing and investment choices (Faccio et al., 2016). Finally, firms with female directors also differ in terms of the incentives of insider directors as reflected by greater payperformance sensitivity as well as greater CEO turnover-performance sensitivity (Adams and Ferreira, 2009). There is also evidence that female directors tend to change the boardroom dynamics. For example, female directors tend to be less conformist and they are also more vocal than their male counterparts (Carter et al., 2003; Adams and Ferreira, 2009; Adams et al., 2011). Further, the quality of boardroom discussions of complex decision problems is improved by the presence of female directors as the latter bring in different and sometimes conflicting points of view, thereby improving the information set available to the board (Miller and Triana, 2009; Gul et al., 2011).