Mind the (Gender Pay) Gap: The role of Board Gender Composition

Gender Pay Gap
Board of directors
Pay transparency

Galanakis, Y. and Gosling, A., (2024), “Mind the (Gender Pay) Gap: The role of Board Gender Composition”

Authors
Affiliations

King’s College London

Amanda Gosling

University of Kent

Published

April 2024

Modified

April 2024

Other details

Presented at ESCoE Conference on Economic Measurement 2023, IAAE 2023 Annual Conference, WPEG Annual Conference 2023, Gender Gaps 2023 Conference, University of Alcalá research seminar, the 26th Colloquium on Personnel Economics and the Productivity Institute Brownbag Seminar Series.

Abstract

This paper explores the role of board gender composition on pay-related outcomes in the UK. Using administrative data from firms with at least 250 employees since 2017/18, we employ a method based on Bartik (1991). Our approach relies on the regional aggregation of the share of female directors. This is exogenous to firm-level wage determination. The findings reveal that a more gender-diverse board can reduce the pay gap by over 3%, as female directors are associated with better outcomes for other female employees. This effect is more pronounced among higher-productivity firms, which often exhibit a higher Gender Pay Gap due to female under-representation and within-firm inequalities. When looking jointly at the board nationality and gender composition, gender is significant for any outcome in company boards where more than 51% of directors are UK nationals.

Important figure

Figure 9: Effect of female directors, by firm productivity type
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