Beyond the Boardroom: When Does Female Ownership Matter for Corporate Value in Family-Owned Firms?

Abstract

Family-owned firms in emerging markets can endure a governance issue because of concentrated ownership and the agency problem between the controlling and the minority shareholders. Although the gender dimensions of boardroom representation have received interest, the effect of female ownership as a unique system of governance has not been addressed adequately. The present study explores the role of ownership of women as a threshold to firm value in Thai-listed family-owned firms through the use of multiple regression-based explanations with reference to the theory of agency and the stewardship theory. Results revealed that a woman-owned firm value does not add independently unless the percentage of female’s ownership is above a critical point but that directors who are women remain positive contributors to the corporate valuation. Moreover, a combination of large female ownership and directorship proves a synergistic effect in canceling out the adverse effect of the family influence. These findings demonstrate why there should be significant gender representation beyond symbolic presence in an ownership structure. Practical implications of the study also offer policy and business executives the ability to create gender-neutral governance and sustainable firm performance in the emerging economies.