Table 5

Independent female directors and cost of equity capital

Variables(1)(2)(3)(4)
PEGMPEGPEGMPEG
Intercept0.076***0.147***0.084***0.152***
(12.826)(26.683)(15.156)(29.646)
%FEMINDDIR−0.002***−0.002***  
(−3.478)(−2.944)  
FEMCEO  −0.003***−0.011***
  (−3.285)(−4.096)
LNBOD−0.007***−0.018***−0.01***−0.02***
(−3.506)(−9.277)(−5.217)(−11.198)
INDPER−0.0010.002−0.0030.001
(−0.42)(0.585)(−0.845)(0.286)
CEODUAL0.002**−0.003***0.002*−0.003***
(2.07)(−3.37)(1.82)(−2.777)
LNMEET0.008***−0.0010.008***−0.001
(5.186)(−0.814)(5.12)(−0.697)
BIG4−0.0010.001−0.0010.001
(−0.532)(0.641)(−0.634)(0.537)
AUDOPIN0.006***−0.003***0.007***−0.002**
(5.983)(−2.621)(6.054)(−2.475)
RESTATE0.005**0.009***0.005**0.009***
(2.267)(4.25)(2.299)(4.303)
LNSIZE−0.001*−0.001***−0.001***−0.001***
(−1.92)(−3.032)(−2.725)(−4.099)
LEVER0.032***0.027***0.032***0.027***
(10.722)(9.533)(10.662)(9.668)
LOSS0.03***0.019***0.03***0.02***
(12.609)(8.697)(12.679)(8.816)
ROA−0.062***−0.04***−0.062***−0.040***
(−15.533)(−10.899)(−15.595)(−10.979)
SALEGR−0.006**0.006**−0.006**0.007***
(−2.321)(2.495)(−2.097)(2.792)
BETA0.017***0.018***0.018***0.018***
(15.883)(17.191)(16.315)(17.642)
IndustryYesYesYesYes
YearYesYesYesYes
Observations8,2248,2248,2248,224
Adj R214.2611.1414.1411.23

Note(s): This table reports regression results of the relation between the cost of equity capital with independent female directorship and female CEO. The dependent variables are PEG and MPEG. ***, **, * Indicate statistical significance at the 1, 5 and 10 percent levels, respectively, based on a two-tailed test. t-statistics are in parentheses. Standard errors are two-way clustered by firm and year to correct for cross-sectional and time-series dependence. See Appendix for variable definitions

Source(s): Computed by authors
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