WHU General

Higher Company Value through Female Leaders

Professor Dr. Burcin Yurtoglu presents research results on women in leadership positions in Turkey at a conference.

Companies with more female directors on their boards might be associated with a higher company value and profitability. This is the conclusion reached by Professor Dr. Burcin Yurtoglu, Chair of Corporate Finance at WHU - Otto Beisheim School of Management, and Melsa Ararat from Sabanci Business School. In their study "Female Directors, Board Committees, and Firm Performance: Time-Series Evidence from Turkey", they investigate the relationship between female representation on Turkish company boards and the companies’ values and profitability. The analysis is based on data covering the vast majority of listed firms for the period 2011 to 2018.

The results show that female board members who take a more active role in company governance through their involvement in board committees predict higher firm value and profitability. Female members of the owner families that are on the board of directors are the main driver for higher firm value, independent female directors predict higher profitability.

The study suggests three channels through which female directors influence the company's results: Female directors facilitate the production of higher quality financial statements, they may lead to lesser incidence of violations of capital market laws and regulations, and they reduce the hoarding of negative news and the related stock price crash risk.

Professor Yurtoglu will present his research results on November 19 at the eighth Women Directors in Turkey Virtual Conference, which takes place under the motto "An inclusive and equitable future" this year. The event will be in English, registration is possible via the conference website.