Do religiosity and political beliefs affect female representation and firm performance?

• Published in: International review of financial analysis 2023-10, Vol.89, p.102809, Article 102809
• Main Authors: Carter, David A., Shank, Corey A.
• Format: Article
• Language: English
• Subjects: Firm performance; Gender board diversity; Politics; Religion
• ISSN: 1057-5219; 1873-8079
• DOI: 10.1016/j.irfa.2023.102809

We investigate the effect of the community values surrounding a firm's headquarters on the percentage of women on a firm's board of directors. We use religiosity and political affiliation measures to capture the values associated with the community norms. We find that firms headquartered in counties with lower religiosity and a lower percentage of Republican voters are more likely to have a greater number of female board members. Furthermore, firms with more female directors located in more Republican areas or more religious cities are more likely to have lower valuations, as measured by Tobin's Q. These results have implications for corporate culture and the supply of female directors. •This study investigates whether the norms surrounding a firms headquarters affect the number of women on the firm’s board.•Firms headquartered in areas with lower religiosity or Republican voters are more likely to have more female directors.•Firms with more female directors located in more Republican or religious areas are more likely to have lower valuations.