Title: Board diversity: lessons from Malaysia

Authors: Shanthy Rachagan; Shelley Marshall; Wai Ching Poon; Elsa Satkunasingam

Addresses: School of Business, Monash University Malaysia, Selangor, 46150, Malaysia ' Department of Business Law and Taxation, Monash University, Victoria 3800, Australia ' School of Business, Monash University Malaysia, Selangor, 46150, Malaysia ' Bursa Malaysia, Bukit Kewangan, Kuala Lumpur 50200, Malaysia

Abstract: This study examines new data concerning the extent of board diversity in Malaysia and the effect of that diversity on firm performance. We find that the presence of non-Malay ethnic minorities and women on Malaysian boards is significantly associated with firm performance. This study provides empirical support that the presence of non-Malay ethnic minorities and women on Malaysian boards are significant with firm performance. This paper recommends that policies that foster board diversity remain important. However, in contexts where diversity is not empirically linked with firm performance, the policy focus should first be directed to measures that encourage openness.

Keywords: board diversity; firm performance; gender; ethnicity; corporate governance; policy implications; resource bundle theory; stakeholder theory; Malaysia; ethnic minorities; women; female board members; openness.

DOI: 10.1504/IJCG.2015.074691

International Journal of Corporate Governance, 2015 Vol.6 No.2/3/4, pp.194 - 216

Received: 26 May 2015
Accepted: 23 Sep 2015

Published online: 13 Feb 2016 *

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