Does Gender Diversity in Top Management Team Relate to Financial Performance? - Implication for Strategic Management

The issue of women representation in top management team has become an important research area within the field of strategic management. This study aims to investigate the link between top management team gender diversity and company financial performance. Based on a sample of small and medium-sized enterprises from the manufacturing sector the findings show positive relationship between top management gender diversity and company financial performance. In particular, we find that companies with female participation in top management teams tend to achieve higher return on equity (ROE) than companies that do not have any women in top management teams. We also find that the number of female in top management team matters. Specifically, the results suggest that increasing number of women in top management teams is associated with higher company financial performance. The study has some important implication for strategic management researches and company managers.