The recent financial crisis has led to a loss of trust in the quality of corporate governance worldwide. The European Commission (EC) currently intends to regulate board diversity (at first gender diversity) by quota, as companies have not voluntarily met the EC’s expectations on this issue. Considering the political debate, it often becomes obvious that the debate on board diversity is primarily discussed from a moral perspective and on the basis of standard economic arguments or stereotypes, ignoring the majority of empirical findings in this field. Focusing on this gap, we identify very mixed results on the links between different attributes for board diversity and economic outcomes. Furthermore, these empirical findings mainly do not consider important aspects of work psychology and organizational behavior in the black box/closed circle of corporate boardrooms and often only focus on single attributes for board diversity and their direct impact on economic outcomes. Thus, without having a deeper understanding of the processes and dynamics within corporate boardrooms, we do not think this is the right time to regulate board diversity. Additionally, we think such a measure disproportionately intervenes in companies’ authority to staff their boards and neglects companies’ specific (economic) situations.
|Keywords:||Board Diversity, Economic Perspective, Moral Perspective, Regulation|
Professor for Corporate Governance, Head of the Department of Corporate Governance, Institute for Finance, Auditing, Controlling, Taxation, Institute for Management, School of Business and Economics, University of Erlangen-Nürnberg, Nuremberg, Bavaria, Germany
Hamburg, Hamburg, Germany