Gender Diversity on the Board - BI Norwegian Business School

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Percent GRA 19001 Master Thesis share of observations in our sample. Therefore, we choose not to draw any conclusions based on these findings. Figure 4.3 illustrates the distribution of female stockholder-elected directors of all observations in our sample. Obviously, the distribution is skewed to the right. Figure 4.3: Distribution of female stockholder-elected directors for large nonlisted firms 80% 60% 40% 20% -2 0 2 4 6 Female stockholder-elected directors Figure 4.3 shows the distribution of female stockholder-elected directors in the sample for large nonlisted firms. The Y-axis measures the number of observations, while the X-axis is the number of female stockholder-elected directors. 4.2 Independent variables In this section descriptive statistics of all independent variables are presented to obtain a better understanding of our data set. The independent variables used are return on assets (ROA), fraction held by largest family owner and CEO-gender. Firm age and firm size are used as control variables. During our sample period, no governance codes are implemented for nonlisted firms. As stated under descriptive statistics, we find an increase in the share of female stockholder-elected directors from 7% to 10%. Since there are no indications of substantial time effects, we do not control for time in the regression. In appendix 2.A4 we show descriptive statistics for all variables. 20
GRA 19001 Master Thesis To measure performance return on assets (ROA) is calculated using the following formula: EBI ROA = Current assets Fixedassets We also exclude extreme outliers in return on assets. EBI is defined as operating earnings before interest after tax. All earnings that may be related to the firms’ operations are included. By using ROA we may disregard the debt structure of the firms. Appedix 2.A5 shows that the median ROA is higher for large nonlisted firms than for all nonlisted firms. The median ROA is 9% in all nonlisted firms and 11% for those defined as large, while the mean ROA is 9% and 13%, respectively. One possible explanation for the higher ROA in large firms may be the survivorship bias. Since our sample contains the firms with high operating income for at least three years, failed companies are excluded and we are left with the firms that survive our restrictions for three years or more. Our findings on ROA are consistent with those of Berzins, Bøhren and Rydland (2008), but our returns are found to be slightly higher. ROA is increasing over time from 9% to 11% for nonlisted firms as a whole, and from 12% to 15% for large nonlisted firms. Family ownership is defined as the percent of shares held by the largest ultimate family owner. We find a decrease in largest ultimate family ownership of 15% from 2004 to 2005 showed in appendix 2.A6. This may be due to the lack of family data in the period up until 2005. The mean for all nonlisted firms is 77% while the median is 100%, indicating that the typical nonlisted firm is a family firm. However, for large nonlisted firms the mean decreases to 66% and the median goes down to 69%. Hence, large firms seem to be family owned to a lower extent. There are many missing values in the family ownership variable, that we have to take into account when we analyze the result. The variable CEO gender has the value 1 if the CEO is female and 0 if male. Descriptive statistics for CEO gender is found in Appendix 2.A7. The fact that both mean and median is 0 indicates that there are by far most male CEOs in nonlisted firms, whatever the firm size. Hence, the CEO in a typical firm is male. 21
Page 1 and 2: Malin Berg Mathisen Linda Waldal BI
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