The impact of women directorship on firm performance in Malaysian energy industry

Jannatul, Ferdous (2023) The impact of women directorship on firm performance in Malaysian energy industry. Master dissertation/thesis, UTAR.

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Abstract

Boardroom diversity attains vast attention due to the corporate legislation, reforms, and financial crisis and scandals of the last few decades. In view of this, Malaysian government imposed 30% women quota on the Bursa Malaysia listed companies. The objective of this research is to study the impact of women directorship on firm performance in Malaysian energy industry. The energy industry was chosen because it is one of the most male-dominated industries in the world. Agency theory and resource dependency theory were used as the theoretical framework of this research. Return on assets, market capitalization and economic value added were chosen to measure the firm performance of this study as dependent variable. Meanwhile, quota attainment, quality of women directors, women directors in risk management committee were considered as independent variables. This study also examined the interaction of quota attainment and Shannon index to check for its moderating impact on firm performance. Thirty-one energy companies listed on Bursa Malaysia for a period of seven years spanning from 2013 to 2019 were taken as the sample of the study. The descriptive analysis indicated an upward trend of women directorship. Meanwhile, panel data regression revealed that quota attainment has negative significant whereas the interaction of quota attainment and Shannon index brings positive impact on both return on assets and market capitalization. As interaction of quota attainment and Shannon index (gender balanced board) bring positive impact on firm performance, board should ensure quota implication along with ensuring proper gender balanced board to bring fruitful impact on firm performance.

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