Md Sikandar Azam

Type of the article: Research Article

Abstract
Gender diversity fosters robust and effective corporate governance mechanisms by introducing diverse perspectives and signaling progressive organizational values. Recognizing the growing significance of inclusive leadership structures, this study examines the characteristics of corporate boards of companies listed on the Bombay Stock Exchange (BSE) and analyzes the impact of women on corporate boards on their financial performance. Drawing on panel data from 379 non-financial firms indexed in 500 BSE-listed companies between 2010 and 2020 the paper employs instrumental variable (IV) regression analysis to explore the relationship between gender diversity and key performance indicators, namely return on equity (ROE), return on sales (ROS), and return on assets (ROA). The empirical evidence indicates a continued predominance of men on Indian corporate boards; however, greater gender representation is associated with significant improvements in firm performance. Gender-diverse boards enhance organizational efficiency and profitability, underscoring the economic value of inclusion. These results suggest that strengthening board diversity constitutes a strategic mechanism for improving financial outcomes. The study supports the theoretical framework of resource dependency and agency theory, which asserts that gender balance improves business success. The study’s emphasis on Indian firms within a specific timeframe limits the generalizability of its findings across other emerging economies. The results underscore the strategic significance of gender diversity, offering valuable evidence for policymakers, regulators, and corporate leaders to promote greater female board participation. The research contributes to the limited literature on board diversity in emerging economies, emphasizing its economic and organizational value.