Graduation Term

2016

Degree Name

Master of Science (MS)

Department

School of Information Technology: Information Systems

Committee Chair

James R. Wolf

Abstract

This study uses a sample of S&P 500 firms in the United States technology sector to investigate the likely relationship between female directors and financial performance of firms measured by return on average assets and return on average equity as the two accounting based measures of performance. Reasonable theoretical arguments drawn from resource dependency, human capital, agency, and social psychology theory, suggests that the gender diversity of the board of directors may have either a positive, negative, or neutral effect on the financial performance of the firm. Using nonparametric statistics approach, we find a small negative relationship between female directors and financial performance of the firm. Also, we find that the difference in the average measures of financial performance between different levels of female directors on the board is almost identical. The results of our statistical analysis support the theoretical position of a negative relationship between female directors and financial performance of the firm. The policy implications of our study do not support the business case for the inclusion of women on the board of directors in United States technology firms. Our findings in the present study suggest that the appointment of women to the board of directors in firms within the United States technology sector, should be based on criteria other than financial performance.

Access Type

Thesis-Open Access

DOI

http://doi.org/10.30707/ETD2016.Mogbogu.O

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