The purpose of this study is to explore the impact that women who sit on boards of directors, as well as women that are part of an interlocking directorate, have on corporate performance. The investigation is placed within the literature on human capital theory and resource dependency as an argument for gender diversity and boards of directors.
A director data set for over 32,000 firms based in the USA, composed of 6,218 women and 54,932 men, is utilized. From this, regression and network analysis were utilized.
It is found that female directors’ participation in interlocking directorates translates into greater corporate performance when compared to simply examining female representation on boards of directors. Additionally, women involved in interlocks translated into greater corporate performance when compared to men. These results support the resource dependency approach.
Results of this study suggest that when considering female directors, corporate performance is enhanced when female directors already sit on the boards of other firms.
This study highlights external network connections to differentiate between human capital theory and resource dependency as an argument for gender diversity and boards of directors.
