Gender Differences and Firm Performance: Evidence from India

Despite a growing literature investigating the effect of gender diversity of CEOs and firm performance, the answer is still unclear. This study estimates the effect of gender differences in ownership and Leadership (CEOs) on firm performance simultaneously. The paper exploits a unique data from more than 9000 Indian firms by using fixed effects and propensity score matching techniques. Findings reveal a positive significant effect of female CEOs on firm performance but no definite effect of female owners on firm performance. The effect is more prominent in progressive and high-sex ratio states in India. Third, the evidence suggests potential payoffs to firms that adopt gender-inclusive policies intended to increase the share of female CEOs in India. Results confirm no bias from unobservable covariates.