Interdependencies of female board member appointments

TL;DR

This paper explores how Japanese corporate board networks influence female board member appointments, revealing gender homophily and the role of interlocks in promoting female representation, especially in profitable firms.

Contribution

It uncovers the network effects and homophily in female board appointments within Japanese corporations, highlighting the importance of interlocks and ownership ties.

Findings

Boards with women tend to be gender-homophilous.

Firms with female directors are generally more profitable.

New female appointments are more common in interconnected boards.

Abstract

We investigate the networks of Japanese corporate boards and its influence on the appointments of female board members. We find that corporate boards with women show homophily with respect to gender. The corresponding firms often have above average profitability. We also find that new appointments of women are more likely at boards which observe female board members at other firms to which they are tied by either ownership relations or corporate board interlocks.