Performance of gender diversity on board of directors: The case of Indonesia

Juniarti Juniarti, Ferry Jie

Article ID: 3438
Vol 8, Issue 4, 2024

VIEWS - 147 (Abstract) 65 (PDF)


This study further explores women’s role in top management in Indonesia, where men still dominate that position. This study underlines the role of women’s boards of commissioners in producing better financial performance in the specific sectors, manufacturing and service sectors, where the power of women to lead these sectors is more optimal. The sample is selected from the Indonesia Stock Exchange for the period 2009–2018. The final sample is 780 observations. This study applies panel data, which is more robust when controlling heterogeneity. Data panel regression is applied to analyze data. This study finds that gender diversity harms market-based performance, while from accounting-based measures, gender diversity has a significant positive effect. This study is applied explicitly in the manufacturing and services industrial sectors; therefore, carefully generalizing the results is necessary. Research in other specific sectors is very open to obtaining specific results in various industries, including developing countries other than Indonesia. The market has not trusted the role of women in top management; there is still a kind of ‘hidden distrust’ about the capabilities of women in running the top leadership captain. The market needs more substantial evidence to believe in women’s performance on the board of directors. Therefore, it is necessary to provide wider opportunities for women to sit on the board of commissioners, as much as men have.


gender diversity; board of directors; market-based; accounting-based; performance

Full Text:



Adams, R. B., Ferreira, D., et al. (2009). Women in the boardroom and their impact on governance and performance. Journal of Financial Economics, 94(2), 291–309.

Ahern, K. R., Dittmar, A. K. (2012). The Changing of the Boards: The Impact on Firm Valuation of Mandated Female Board Representation. The Quarterly Journal of Economics, 127(1), 137–197.

Ali, J., Shabir, S. (2017). Does gender make a difference in business performance? In Gender in Management: An International Journal, 32(3), 218–233. Emerald.

Anderson, R. C., Mansi, S. A. Reeb, D. M. (2003). Founding family ownership and the agency cost of debt. Journal of Financial Economics, 68(2), 263–285.

Anderson, R. C., Reeb, D. M. (2003). Founding‐Family Ownership and Firm Performance: Evidence from the S&P 500. The Journal of Finance, 58(3), 1301–1328.

Andres, C. (2008). Large shareholders and firm performance—An empirical examination of founding-family ownership. Journal of Corporate Finance, 14(4), 431–445.

Arquisola, M. J., Shella, K., Hutabarat, E. (2018). How does board diversity affect the financial performance of commercial banks in Indonesia? An inquiry. Jurnal Manajemen. 22(1): 62–73.

Bear, S., Rahman, N. and Post, C. (2010). The Impact of Board Diversity and Gender Composition on Corporate Social Responsibility and Firm Reputation. Journal of Business Ethics, 97(2), 207–221.

Beckman, C. M., Haunschild, P. R., et al. (2002). Network Learning: The Effects of Partners’ Heterogeneity of Experience on Corporate Acquisitions. Administrative Science Quarterly, 47(1), 92–124.

Benkraiem, R., Hamrouni, A., Faten Lakhal, Famrouni, F., et al. (2017). Board independence, gender diversity and CEO compensation. The International Journal of Business in Society, 17(5), 845–860.

Bennouri, M., Chtioui T., Nagati, H., et al. (2018). Female board directorship and firm performance: What really matters? Journal of Banking & Finance, 88, 267–291.

Bjuggren, P. O., Nordström, L., Palmberg, J., et al. (2018). Are female leaders more efficient in family firms than in non-family firms? The International Journal of Business in Society, 18(2), 185–205.

Campbell, K., Mínguez-Vera A, et al. (2007). Gender Diversity in the Boardroom and Firm Financial Performance. Journal of Business Ethics, 83(3), 435–451.

Carter, D. A., Simkins, B. J. Simpson, W. G. (2003). Corporate Governance, Board Diversity, and Firm Value. Financial Review, 38(1), 33–53.

Chapple, L., Humphrey, J. E. (2013). Does Board Gender Diversity Have a Financial Impact? Evidence Using Stock Portfolio Performance. In Journal of Business Ethics, 122(4), 709–723.

Chu, W. (2009). Family ownership and firm performance: Influence of family management, family control, and firm size. Asia Pacific Journal of Management, 28(4), 833–851.

Chua, J. H., Chrisman, J. J., Steier, L. P. et al. (2012). Sources of Heterogeneity in Family Firms: An Introduction. Entrepreneurship Theory and Practice, 36(6), 1103–1113.

Connelly, J. T., Limpaphayom, P. Nagarajan, N. J. (2012). Form versus substance: The effect of ownership structure and corporate governance on firm value in Thailand. Journal of Banking Finance, 36(6), 1722–1743.

Cox, T. (1991). The multicultural organization. Academy of Management Perspectives, 5(2), 34–47.

Cox, T. H., Blake, S. (1991). Managing cultural diversity: Implications for organizational competitiveness. Academy of Management Perspectives, 5(3), 45–56.

Crossan, M. M., Lane, H. W., White, R. E. (1999). An Organizational Learning Framework: From Intuition to Institution. The Academy of Management Review, 24(3), 522.

Darmadi, S. (2013). Do women in top management affect firm performance? Evidence from Indonesia. Corporate Governance: The International Journal of Business in Society, 13(3), 288–304.

Eagly, A. H., Johnson, B. T. (1990). Gender and leadership style: A meta-analysis. Psychological Bulletin, 108(2), 233–256.

Earley, P. C., Mosakowski, E. (2000). Creating hybrid team cultures: An empirical test of transnational team functioning. Academy of Management Journal, 43(1), 26–49.

Eisenhardt, K. M. (1989). Agency Theory: An Assessment and Review. The Academy of Management Review, 14(1), 57.

Erhardt, N. L., Werbel, J. D., Shrader, C. B. (2003). Board of Director Diversity and Firm Financial Performance. Corporate Governance, 11(2), 102–111.

Fama, E. F., Jensen, M. C. (1983). Agency Problems and Residual Claims. The Journal of Law and Economics, 26(2), 327–349.

Fėlix, E. G. S., David, D. S. T. (2019). Performance of family-owned firms: The impact of gender at the management level. Journal of Family Business Management, 9(2), 228–250.

Fidanoski, F., Simeonovski, K., Mateska, V. (2014). The Impact of Board Diversity on Corporate Performance: New Evidence from Southeast Europe. In: Advances in Financial Economics. Emerald Group Publishing Limited. pp. 81–123.

Flynn, P. M., Haynes, K., Kilgour, M. A. (2017). Integrating Gender Equality into Business and Management Education. Routledge.

Gerdeman, D. (2019). How gender stereotypes kill a woman’s self-confidence. Available online: (accessed on 15 June 2021).

Gordini, N., Rancati, E. (2017). Gender diversity in the Italian boardroom and firm financial performance. Management Research Review, 40(1), 75–94.

Gul, F. Srinidhi, B., Ng, A. (2011). Does board gender diversity improve the informativeness of stock prices? Journal of Accounting and Economics, 51(3), 314–338.

Hafsi, T., Turgut, G. (2012). Boardroom Diversity and its Effect on Social Performance: Conceptualization and Empirical Evidence. Journal of Business Ethics, 112(3), 463–479.

Hambrick, D. C., Mason, P. A. (1984). Upper Echelons: The Organization as a Reflection of Its Top Managers. The Academy of Management Review, 9(2), 193.

Hillman, A. J., Dalziel, T. (2003). Boards of Directors and Firm Performance: Integrating Agency and Resource Dependence Perspectives. Academy of Management Review, 28(3), 383–396.

Humbert, A. L. Guenther, E. A. (2017). The gender diversity index, preliminary considerations and results. Available online: (accessed on 18 October 2022).

Ionascu, M., Ion, I., Sacarin, M., et al. (2018). Women on Boards and Financial Performance: Evidence from a European Emerging Market. In Sustainability, 10(5), 1644.

Issa, A., Fang, H. X. (2019). The impact of board gender diversity on corporate social responsibility in the Arab Gulf states. Gender in Management: An International Journal, 34(7), 577–605.

Kılıç, M., Kuzey, C. (2016). The effect of board gender diversity on firm performance: Evidence from Turkey. Gender in Management: An International Journal, 31(7), 434–455.

Kirsch, A. (2018). The gender composition of corporate boards: A review and research agenda. The Leadership Quarterly, 29(2), 346–364.

Krishnan, H. A., Park, D. (2005). A few good women—On top management teams. In Journal of Business Research, 58(12), 1712–1720. Elsevier BV.

Kusumastuti, S., Supatmi, Sastra, P. (2007). The Effect of Board Diversity on Firm Value in the Perspective of Corporate Governance (Indonesian). Jurnal Akuntansi dan Keuangan, 9(2), 88–98.

Kyaw, K., Olugbode, M., Petracci, B. (2015). Does gender diverse board mean less earnings management? Finance Research Letters, 14, 135–141.

Lee-Kuen, I. Y., Sok-Gee, C., Zainudin, R. (2017). Gender Diversity and Firms’ Financial Performance in Malaysia. Asian Academy of Management Journal of Accounting and Finance, 13(1), 41–62.

Lindawati, A. S. L., Smark, C. (2015). Barriers to Women’s Participation in the Accounting Profession in Java, Indonesia. Australasian Accounting, Business and Finance Journal, 9(1), 89–101.

Mahadeo, J. D., Soobaroyen, T., Hanuman, V. O. (2011). Board Composition and Financial Performance: Uncovering the Effects of Diversity in an Emerging Economy. Journal of Business Ethics, 105(3), 375–388.

Marinova, J., Plantenga, J., Remery, C. (2015). Gender diversity and firm performance: Evidence from Dutch and Danish boardrooms. The International Journal of Human Resource Management, 27(15), 1777–1790.

Martín-Ugedo, J. F., Minguez-Vera, A. (2014). Firm Performance and Women on the Board: Evidence from Spanish Small and Medium-Sized Enterprises. Feminist Economics, 20(3), 136–162.

Noviera, A., Adhariani, D. (2018). CEO gender, financial performance and firm risk level: Evidence from Indonesia. International Journal of Economics and Management, 12, 67–77.

Pasaribu, P., Masripah, M., Mindosa, B. (2019). Does Gender Diversity in the Boardroom Improve Firm Performance? Evidence from Indonesia. Economics and Finance in Indonesia, 65(1), 1.

Pérez-González, F. (2006). Inherited Control and Firm Performance. American Economic Review, 96(5), 1559–1588.

Pudjiastuti, W., Mardiyah, A. A. (2007). The influence of board structure on firm performance. Available online: (accessed on 10 March 2019).

PwC. (2014). Survey Bisnis Keluarga 2014 Indonesia. PwC Indonesia. Available online: (accessed on 5 March 2019).

Ramadani, V., Hisrich, R. D., Anggadwita, G., Alamanda, D. T. (2017). Gender and succession planning: Opportunities for females to lead Indonesian family businesses. International Journal of Gender and Entrepreneurship, 9(3), 229–251.

Rehman, A., Shah, S. Z. A. (2013). Board independence, ownership structure and firm Performance: Evidence from Pakistan. Interdisciplinary Journal of Research in Business, 5(3), 832–845.

Remery, C., Matser, I., Hans Flören, R. (2014). Successors in Dutch family businesses: Gender differences. Journal of Family Business Management, 4(1), 79–91.

Robinson, G., Dechant, K. (1997). Building a business case for diversity. Academy of Management Perspectives, 11(3), 21–31.

Rodríguez‐Ariza, L., Cuadrado‐Ballesteros, B., Martínez‐Ferrero, J., et al. (2017). The role of female directors in promoting CSR practices: An international comparison between family and non‐family businesses. Business Ethics: A European Review, 26(2), 162–174. Portico.

Rose, C. (2007). Does female board representation influence firm performance? The Danish evidence. Corporate Governance: An International Review, 15(2), 404–413.

Trinugroho, I., Sawitri, H. S. R., Untoro, W. (2016). Women in Top Management and Bank Performance: Evidence from Indonesia. Indonesian Capital Market Review, 8(1).

Schein, V. E., Mueller, R., Lituchy, T., et al. (1996). Think manager—Think male: A global phenomenon? Journal of Organizational Behavior, 17(1), 33–41.<33::aid-job778>;2-f

Setó‐Pamies, D. (2013). The Relationship between Women Directors and Corporate Social Responsibility. Corporate Social Responsibility and Environmental Management, 22(6), 334–345. Portico.

Shyu, J. (2011). Family ownership and firm performance: Evidence from Taiwanese firms. International Journal of Managerial Finance, 7(4), 397–411.

Smith, N., Smith, V., Verner, M. (2005). Do Women in Top Management Affect Firm Performance? A Panel Study of 2500 Danish Firms. SSRN Electronic Journal.

Syamsudin, S., Setiany, E., Sajidah, S. (2017). Gender diversity and firm value: A study on boards of public manufacturing firms in Indonesia. Problems and Perspectives in Management, 15(3), 276–284.

Tarigan, J., Hervindra, C., Hatane, S. E. (2018). Does Board Diversity Influence Financial Performance? International Research Journal of Business Studies, 11(3), 195–215.

Triana, Asri, M. (2017). The Impact of Female Directors on Firm Performance: Evidence from Indonesia. Journal of Indonesian Economy and Business, 31(1), 19.

Wang, K. T., Shailer, G. (2017). Family ownership and financial performance relations in emerging markets. International Review of Economics & Finance, 51, 82–98.

Wright, L., Tellei, V. C. (1993). Women in Management in Indonesia. International Studies of Management & Organization, 23(4), 19–45.



  • There are currently no refbacks.

Copyright (c) 2024 Juniarti, Ferry Jie

License URL:

This site is licensed under a Creative Commons Attribution 4.0 International License.