Does Female Representation Improve Board Processes? It Depends on Director Perceptions of The Chair

Board processes are considered crucial to board effectiveness, yet research on female board representation (FBR) rarely evaluates its effect on board processes. Research suggests that as FBR increases, it has countervailing effects on board processes: improvements as a function of interpersonal qualities women are presumed to bring to the board, and deterioration as a function of increasing diversity resistance from male directors. Because of board chairs’ sizable influence on board processes, we consider how directors’ perceptions of their chair moderates the FBR – board processes relationship. Analyzing survey data from 826 directors, representing 111 boards, we find an inverted-U relationship between FBR and five key board processes. When FBR is relatively low, it is associated with more effective board processes, but as FBR approach 40% it becomes associated with deteriorating board processes. However, when directors perceive their chairperson as exhibiting transparency, seeking complete information, behaving consistently, and being self-aware (e.g., when they perceive their chair as exhibiting ‘authentic leadership’ behaviors), not only are board processes superior at all FBR levels, but the positive effects of FBR persist beyond the turning points.