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Falling stock prices? Shareholders blame female board members

business Updated: Aug 16, 2009 21:11 IST

PTI
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Women might be good performers on the corporate corridors but companies with female board members seem to fare worse on the stock market as their share prices sail southwards, says a research.

Research work carried out by the University of Exeter suggests that shareholders react negatively to women being appointed to companies’ boards and are “unenthusiastic” about females cornering senior positions.

“Companies with female board members fare worse on the stock market, despite performing as well on all other measures as those with all-male boards,” the University said.

The findings are from a team of the University of Exeter’s School of Psychology and Business School, which conducted a comprehensive analysis of performance data from all FTSE 100 companies between 2001 and 2005.

“... companies with all-male boards had a market valuation equivalent to 166 per cent of their book value, while companies with at least one female board member had a market value equal to just 121 per cent of book value,” the University said in a statement.

However, the findings published in the British Journal of Management noted that appointing a woman to a firm’s board does not compromise objective measures of financial performance such as ‘Return on Assets´ and ‘Return on Equity´.