Board Gender Diversity and Accounting Conservatism

Posted: 1 Jun 2017

See all articles by Bin Srinidhi

Bin Srinidhi

University of Texas at Arlington - Department of Accounting; City University of Hong Kong (CityUHK) - Department of Accountancy

Judy S.L. Tsui

Hong Kong Polytechnic University - School of Accounting and Finance

Gaoguang (Stephen) Zhou

Hong Kong Baptist University

Date Written: May 31, 2017

Abstract

We examine the effect of board gender diversity on accounting conservatism. Particularly, we investigate changes in the degree of conservatism for firms that transit from an all-male board (audit committee) to a gender diverse board (audit committee).

Using a sample of U.S. firms from 1998 to 2014, we show that the degree of conservatism in accounting increases in firms after the transitions, compared to:

(i) firms without transitions and,

(ii) firms with transitions that do not involve the induction of a female director (audit committee member).

Furthermore, the results show that the increased conservatism is “sticky”, i.e. it does not reverse after departure of female directors.

Keywords: Accounting Conservatism; Corporate Governance; Female Director

JEL Classification: G34, M41, M48

Suggested Citation

Srinidhi, Bin and Tsui, Judy S.L. and Zhou, Gaoguang (Stephen), Board Gender Diversity and Accounting Conservatism (May 31, 2017). Available at SSRN: https://ssrn.com/abstract=2977817

Bin Srinidhi

University of Texas at Arlington - Department of Accounting ( email )

Arlington, TX 76013
United States

City University of Hong Kong (CityUHK) - Department of Accountancy ( email )

83 Tat Chee Avenue
Kowloon
Hong Kong
China

Judy S.L. Tsui

Hong Kong Polytechnic University - School of Accounting and Finance ( email )

M715, Li Ka Shing Tower
Hung Hom, Kowloon, Kowloon
Hong Kong
852 2766 7828 (Phone)
852 2334 7830 (Fax)

Gaoguang (Stephen) Zhou (Contact Author)

Hong Kong Baptist University ( email )

Kowloon Tong
Hong Kong
China

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