Impact of Boardroom Gender Diversity on Working Capital Management: Evidence from Emerging Economies

The study investigates the influence of boardroom gender diversity (GDB) on firms’ working capital management (WCM) in the context of emerging economies. Using panel data from 722 firms across two major emerging economies, China and India, and applying the generalized method of moments for regression analysis, we find that enhancing GDB leads to a shortening of the cash conversion cycle and inventory days. This finding indicates that GDB improves firms’ cash cycle and inventory management. However, this study does not find a statistically significant role of GDB in accounts receivable and payable management. We also examine how female representation within the executive leadership of companies influences the relationship between GDB and WCM. We find that female representation within the executive team moderates the relationship between GDB and inventory days, suggesting that executive-level gender diversity can attenuate the negative implications of lower GDB on inventory management. Robustness checks using alternative proxies for GDB and WCM, along with subsample analyses of manufacturing firms, confirm the consistency of the findings. The study has important implications for corporate leaders and policymakers in emerging economies, as it highlights the strategic role of gender diversity in improving the management of resources in day-to-day operations through efficient WCM.