Board diversity and financial reporting quality: evidence from China. Issue 2 (10th July 2023)

• Record Type: Journal Article
• Authors: Ullah, Irfan; Zhao, Qiujun; Zeb, Aurang; Iqbal, Amjad; Khan, Muhammad Arif
• Is Part Of: Ekonomska istraživanja. Volume 36:Issue 2(2023)
• Publication Date: 2023-07-10
• Subjects: Board diversity -- financial reporting quality -- corporate governance -- China; M14 -- M41 -- G34 -- M48; Economics -- Research -- Periodicals; Economics -- Research; Electronic journals; 330.072
• DOI: 10.1080/1331677X.2022.2142812
• Languages: English
• ISSNs: 1331-677X

Abstract

Abstract: This study explores the relationship between board diversity and financial reporting quality (FRQ) in China, an emerging market, by using panel data techniques. Specifically, it investigates firms registered from 2005 to 2018. Board diversity is categorised into relation (i.e., gender and age), task (i.e., education, tenure, and experience), and overall board diversity (sum of relation and task diversities). Findings indicate that board diversity has a significant positive impact on FRQ. The relationship between board diversity and FRQ is also strong in non-state-owned firms and during noncrisis periods. Findings remain consistent after numerous robustness checks comprising instrumental approach, propensity score matching, generalised method of moment, lag of independent variables, Heckman two-step model, change analysis, and alternative FRQ measures. Overall, board diversity is found to be associated with corporate outcomes.