Board gender diversity and firm performance: new evidence from cultural diversity in the boardroom

Purpose This study extends the current literature in the context of European countries by showing that women's participation on the board can enhance the financial performance of a company while moderated by many cultural factors. Design/methodology/approach This study examines 19 European countries throughout the period 2010–2020. The time-invariant or individual fixed-effect models are used. Findings The authors found that high power distance and masculinity undermine the impact of board gender diversity on firm performance. The gender-diverse board reports a statistically significant negative impact on return on asset (ROA) and return on equity (ROE) while moderated by the power distance index. Originality/value This research will be of significant value to the board directors, practitioners and the concerned authority who desire to polish up the firm performance of European countries that are governed by cultural norms.