The influence of gender diversity in boardrooms on the financial performance of a firm before and after the instalment of a gender quota.

This paper investigates the influence of gender diversity in boardrooms on firm performance with and without a gender quota. The sample consists of Dutch firms listed on the AEX, AMX and AScX indices in the years 2007 – 2012 and 2013 – 2018. OLS regressions lead to positive but insignificant results both time periods. Interesting is that the effect seems to become more positive in the years after the instalment of the gender quota. However, 2SLS regressions suggest a negative but insignificant relationship between gender diversity and firm performance. Lastly, regressions incorporating the interaction effect between a dummy variable for the time period and the gender variable show a significantly more positive effect on Tobin’s Q for all variables. Moreover, graphs show an increase in the percentage of women on the board of directors over the years. It is concluded that the gender quota leads to more female directors and higher firm performance.