Do board gender quotas affect firm value? Evidence from California Senate Bill No. 826
Name:
California Boards Draft 9-30-19 ...
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2023-02-01
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533.5Kb
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Description:
Final Accepted Manuscript
Affiliation
Univ ArizonaIssue Date
2020-02Keywords
Boards of directorsFemale directors
Gender diversity
Gender quota
Corporate governance
Regulation
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Greene, D., Intintoli, V. J., & Kahle, K. M. (2020). Do board gender quotas affect firm value? Evidence from California Senate Bill No. 826. Journal of Corporate Finance, 60, 101526. https://doi.org/10.1016/j.jcorpfin.2019.101526 Journal
JOURNAL OF CORPORATE FINANCERights
Copyright © 2019 Elsevier B.V. All rights reserved.Collection Information
This item from the UA Faculty Publications collection is made available by the University of Arizona with support from the University of Arizona Libraries. If you have questions, please contact us at repository@u.library.arizona.edu.Abstract
We examine stock market reactions, direct costs of compliance, and board adjustments to California Senate Bill No. 826 (SB 826), the first mandated board gender diversity quota in the United States. Announcement returns average -1.2% and are robust to the use of multiple methodologies. Returns are more negative when the gap between the mandated number and the pre-SB 826 number of female directors is larger. These negative effects are less severe for firms with a greater supply of female candidates, and for those that can more easily replace male directors or attract female directors. For small firms, the annual direct cost of compliance through board expansion is non-trivial, representing 0.76% of market value. Following SB 826, firms significantly increase female board representation, and the increase is greater for firms in California than control firms in other states.Note
36 month embargo; published online: 1 February 2020ISSN
0929-1199Version
Final accepted manuscriptae974a485f413a2113503eed53cd6c53
10.1016/j.jcorpfin.2019.101526