Women directors’ attributes and demographics: New insights into bank risk

• Published in: Research in international business and finance 2024-08, Vol.71, p.102444, Article 102444
• Main Authors: Elnahass, Marwa, Alharbi, Rana, Mohamed, Toka S., McLaren, Josie
• Format: Article
• Language: English
• Subjects: Bank risk; Bank type; Board diversity; Women attributes; Women directors
• ISSN: 0275-5319
• DOI: 10.1016/j.ribaf.2024.102444

This study examines the impact of women directors’ representation and characteristics on bank risk in a unique sample of 12 developing countries with dual banking systems. We examine different women’s leadership and monitoring attributes (leadership and independence) and demographic attributes (educational level and background, foreign directors, and financial expertise). Our results indicate that women directors significantly reduce bank risk, regardless of bank type. Foreign female directors and the financial expertise of women directors are both associated with high bank risk while the relation is inverted for independent women directors. We also find that women directors with high educational qualifications (i.e., postgraduate level) and those holding qualifications in accounting and finance are negatively associated with bank risk. Considering bank type, women on the board have an overall adverse impact on risk in Islamic banks, showing high bank risk across various risk indicators and directors’ attributes/demographics. [Display omitted] •The impact of women directors’ representations and characteristics on bank risk for developing countries is investigated.•Women directors significantly reduce bank risk, regardless of bank type.•Foreign female directors are associated with high bank risk unlike independent directors.•Women directors holding high educational qualifications are negatively associated with bank risk.•Considering the bank type, women directors have an overall adverse impact on risk in Islamic banks.