Board gender diversity and innovation activities: Evidence from R&D investments in the UK

Figures & data

Table 1. Descriptive statistics

Variables	Mean	SD	Min	P50	Max
R&D intensity	0.016	0.041	0.000	0.000	0.241
Gender diversity	0.192	0.119	0.000	0.200	0.590
Gender diversity (dummy)	0.850	0.355	0.000	1.000	1.000
Female tenure	3.220	2.113	0.000	2.900	17.000
CEO age	54.041	5.702	40.000	54.000	70.000
CEO tenure	5.653	5.433	1.000	4.000	29.000
CEO female	0.053	0.223	0.000	0.000	1.000
CEO change	0.158	0.365	0.000	0.000	1.000
CEO ownership	0.021	0.067	0.000	0.004	0.537
Board tenure	4.529	2.194	1.000	4.000	12.00
Board size	9.081	2.070	5.000	9.000	15.00
Board independence	0.705	0.101	0.429	0.714	0.900
Board age	57.23	3.106	48.90	57.30	65.00
Busy board	0.039	0.194	0.000	0.000	1.000
Size (log)	14.729	1.475	11.553	14.518	19.173
Leverage	0.712	1.862	−10.521	0.528	10.532
ROA	0.066	0.096	−0.629	0.060	2.043
Loss	0.107	0.310	0.000	0.000	1.000
Intangibles	0.289	0.223	0.000	0.265	0.833

Note: All variables are defined in Appendix 1. All variables are winsorised at 1% and 99%.

Table 2. Correlation matrix

	1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17
1. R&D intensity	1
2. CEO age	−0.0017	1
3. CEO tenure	−0.0065	0.30***	1
4. Female CEO	0.021	−0.047	−0.033	1
5. CEO change	0.024	−0.11***	−0.41***	−0.024	1
6. CEO ownership	0.0052	0.12***	0.23***	−0.059*	−0.080***	1
7. Board tenure	0.013	0.15***	0.46***	−0.0043	−0.22***	0.046	1
8. Board size	0.0051	0.12***	0.011	0.037	−0.039	−0.11****	0.011	1
9. Board independence	−0.0032	0.053*	−0.26***	−0.011	0.072**	−0.11****	−0.27****	0.27***	1
10. Gender diversity	0.0021	−0.09***	0.034	−0.15***	−0.0053	0.10***	0.16***	−0.15***	−0.25****	1
11. Board age	0.13***	0.49***	0.075**	−0.014	−0.056*	−0.056*	0.28***	0.18***	0.26***	−0.0074	1
12. Size	−0.071***	0.19***	−0.086***	0.023	−0.04	−0.094***	−0.040	0.57***	0.38***	−0.25***	0.35***	1
13. Leverage	−0.043	−0.037	−0.017	0.032	−0.017	0.0074	0.010	0.066**	0.074**	−0.058*	0.0094	0.12***	1
14. ROA	−0.11***	0.038	0.096***	0.013	−0.058*	0.087***	0.10***	−0.071**	−0.14***	−0.059*	−0.0065	−0.18***	−0.025	1
15. Intangibles	0.21***	0.0099	−0.064**	0.11***	0.034	−0.14***	−0.076**	0.059*	0.023	−0.084***	−0.039	−0.0055	0.03	−0.18***	1
16. Busy board	−0.062***	0.055*	−0.046	−0.048*	−0.031	0.015	0.061*	0.041	0.082***	0.051*	0.15***	0.21***	0.0012	0.044	−0.061*	1
17. Loss	−0.023	−0.0058	−0.057*	−0.04	0.080***	0.026	−0.11***	0.075**	0.083***	0.047*	0.0037	0.086***	0.027	−0.48***	−0.031	−0.022	1

Note: *, **, *** indicate statistical significance at the 0.10, 0.05, and 0.01 levels, respectively.

Table 3. Gender diversity and R&D intensity

	Panel 1		Panel 2
	Coefficient	t-value	Coefficient	t-value
Gender diversity	0.750**	2.22	0.158*	1.73
CEO age	−0.009	−0.09	0.0010	0.10
CEO tenure	−0.0285***	−2.59	−0.0287***	−2.60
Female CEO	−0.104	−0.48	−0.0401	−0.19
CEO change	−0.044	−0.53	−0.0414	−0.50
CEO ownership	−0.834	−1.01	−0.860	−1.05
Board tenure	0.047**	2.33	0.0429**	2.13
Board size	−0.0044	−0.17	−0.0077	−0.30
Board independence	−0.718	−1.34	−0.542	−1.03
Board age	0.0026	0.13	0.0036	0.18
Busy board	−0.075	−0.35	−0.0892	−0.41
Size	−0.328***	−2.85	−0.260**	−2.42
Leverage	−0.0035	−0.23	−0.0017	−0.11
ROA	−0.831	−1.32	−0.758	−1.20
Intangibles	1.106**	2.36	0.957**	2.07
Loss	−0.317***	−2.75	−0.317***	−2.75
Constant	7.188***	3.78	5.219***	3.35
N	1,732		1,732
Adj. R^2	0.185		0.187

Note: *, **, and *** indicate statistical significance at the 0.10, 0.05, and 0.01 levels (two-tailed), respectively. All tabulated t-statistics are based on robust standard errors that are clustered at the firm level.

Table 4. Gender diversity and R&D intensity (using interaction term with female tenure)

	Panel 1		Panel 2
	Coefficient	t-value	Coefficient	t-value
Gender diversity	0.834	1.52**	0.149	1.830*
Gender diversity×Female tenure	0.164	1.02	0.254	0.570
Female tenure	0.1410	1.080	0.249	0.255
CEO age	−0.0026	−0.26	−0.017	−0.160
CEO tenure	−0.0181	−1.69*	−0.028	−1.74*
Female CEO	−0.0121	−0.060	−0.003	−0.020
CEO change	−0.047	−0.57	−0.044	−0.540
CEO ownership	−1.352	−1.55	−1.455	−1.69*
Board tenure	0.022	1.830*	0.0186	1.880*
Board size	−0.003	−0.14	−0.001	−0.020
Board independence	−0.068	−1.29	−0.155	−0.023
Board age	0.008	0.37	0.006	0.290
Busy board	−0.074	−0.31	−0.071	−0.310
Size	−0.421	−3.42***	−0.385	−3.35***
Leverage	−0.006	−0.056	−0.003	−0.030
ROA	−0.831	−2.29**	−0.890	−2.230**
Intangibles	1.566	3.31***	1.490	3.20***
Loss	−0.347	−2.93***	−0.355	−3.00***
Constant	7.828	3.90***	6.371	3.790***
N	1,732		1,732
Adj. R^2	0.193		0.195

Note: *, **, *** indicate statistical significance at the 0.10, 0.05, and 0.01 levels (two-tailed), respectively. All tabulated t-statistics are based on robust standard errors that are clustered at the firm level.

Table 5. Gender diversity and R&D intensity (for R&D-intense sample)

	Panel 1		Panel 2
	Coefficient	t-value	Coefficient	t-value
Gender diversity	1.33**	2.25	0.356**	1.88
CEO age	0.0038	0.02	0.0049	0.24
CEO tenure	−0.0595**	−2.44	−0.0618**	−2.53
Female CEO	−1.018	−1.47	−0.878	−1.28
CEO change	−0.100	−0.55	−0.113	−0.61
CEO ownership	−1.759	−0.96	−1.690	−0.92
Board tenure	0.0866*	1.90	0.0750*	1.66
Board size	0.0465	0.80	0.0347	0.59
Board independence	−1.923	−1.62	−1.618	−1.38
Board age	0.0401	0.91	0.0430	0.97
Busy board	−0.132	−0.23	−0.218	−0.38
Size	−0.778***	−2.97	−0.601***	−2.51
Leverage	−0.0151	−0.52	−0.0119	−0.41
ROA	−2.152	−1.58	−1.843	−1.36
Intangibles	2.607**	2.55	2.243**	2.24
Loss	−0.828***	−3.12	−0.794***	−2.99
Constant	13.61***	3.11	9.015**	2.55
N	751		751
Adj. R^2	0.157		0.161

Note: *, **, and *** indicate statistical significance at the 0.10, 0.05, and 0.01 levels (two-tailed), respectively. All tabulated t-statistics are based on robust standard errors that are clustered at the firm level.

Table 6. Gender diversity and R&D intensity for R&D-intense sample (using interaction term)

	Panel 1		Panel 2
	Coefficient	t-value	Coefficient	t-value
Gender diversity	2.340	2.650**	1.387	1.93**
Gender diversity*Female tenure	0.507	1.360	0.303	0.610
Female tenure	0.411	1.350	0.307	0.600
CEO age	−0.008	−0.380	−0.006	−0.028
CEO tenure	−0.035	−1.680*	−0.033	−1.650
Female CEO	−0.721	−0.990	−0.734	−1.010
CEO change	−0.105	−0.570	−0.086	−0.460
CEO ownership	−2.604	−1.410	−2.823	−1.540
Board tenure	0.024	0.530	0.025	0.550
Board size	0.030	0.501	0.053	0.900
Board independence	−0.694	−0.550	−0.484	−0.380
Board age	0.041	0.901	0.032	0.710
Busy board	−0.109	−0.018	−0.005	−0.001
Size	−0.890	−3.570***	−1.101	−3.80***
Leverage	−0.008	−0.030	−0.007	−0.271
ROA	−1.98	−2.62***	−2.380	−2.75***
Intangibles	2.690	3.22**	3.687	3.580***
Loss	−0.849	−3.14***	−0.898	−3.32***
Constant	17.38	3.68***	17.55	3.66***
N	751		751
Adj. R^2	0.158		0.160

Note: *, **, and *** indicate statistical significance at the 0.10, 0.05, and 0.01 levels (two-tailed), respectively. All tabulated t-statistics are based on robust standard errors that are clustered at the firm level.

Table 7. Regression of the relationship between board gender diversity and R&D intensity using 2SLS

	1^st Stage		2^nd Stage
Variables	Coeff.	t-value	Coeff.	t-value
Gender diversity_predict	0.023	1.81*
Gender diversity			0.013	2.05**
Gender diversity (dummy)			0.035	1.71*
Control variables	Included		Included
Partial R^2	0.0132

Note: *, **, and *** indicate statistical significance at the 0.10, 0.05, and 0.01 levels (two-tailed), respectively. Control variables are included in both stages but not presented for brevity. All tabulated t-statistics are based on robust standard errors that are clustered at the firm level.

Table

Variables	Definition
R&D Intensity	Research and development expenditures scaled by the total sales for firm i in year t.
Gender Diversity	The percentage of female directors to the total members of the board of firm i in year t.
CEO Age	Chronological age of CEO for firm i in year t.
CEO Tenure	The number of continuous years CEO has been in his/her role for firm i in time period t.
CEO Female	An indicator variable equal to 1 if the CEO of firm i in year t is female, and 0 otherwise.
CEO Change	An indicator variable equal to 1 if the CEO of firm i was appointed in year t, and 0 otherwise.
CEO Ownership	The percentage of shares held by CEO of firm i in year t scaled by the number of outstanding shares.
Board Tenure	The average tenure of all board members for firm i in year t.
Board Size	The total number of members on the board for firm i in time period t.
Board Independence	The percentage of independent directors on the board of firm i in year t.
Board Age	The average age of all board members of firm i in year t.
Busy Board	Dummy variable that takes the value of one if at least 50% of the shareholder representatives hold three or more directorships, and zero otherwise.
Size	The natural logarithm of total assets for firm i in year t.
Leverage	The total debt for firm i in year t scaled by the total equity.
ROA	Net operating income divided by total assets for firm i in time period t.
Intangible Intensity	Intangible assets scaled by the total assets for firm i in time period t.
Loss	An indicator variable equal to 1 if firm i in year t has reported a loss in the previous year, and 0 otherwise.