Nexus between Firm Risk and Gender Diversity in Foreign Operations

  • Ashiq Ali Department of Management Sciences, COMSATS University, Park Road, Chak Shahzad, Islamabad, 44000, Pakistan
  • Abubakr Saeed Department of Management Sciences, COMSATS University, Park Road, Chak Shahzad, Islamabad, 44000, Pakistan
Keywords: Risk Spread, Holding Firm, Foreign Subsidiaries, TMT Gender Diversity, Signaling Theory

Abstract

Drawing upon signaling theory we investigate the impact of holding firm risk spread on foreign subsidiary's TMT gender diversity. Signaling theory conceptualizes that TMT gender diversity is a legitimacy-seeking strategy. The sample consists of Chinese 123 foreign subsidiaries from 19 countries from 2010 to 2019. Using System GMM estimation technique to investigate the impact of holding firm’s risk spread on foreign subsidiaries TMT gender diversity. The study results suggest that the holding firm’s risk spread has a positive and significant impact on foreign subsidiary TMT gender diversity. Thus, against higher holding firms’ risk, the foreign subsidiaries use the TMT gender diversity strategy to transmit signals to get legitimacy and buffer the spread effect. Based upon our study results the international business policymakers are suggested to use corporate governance strategies against holding firms’ risk spread to get legitimacy in the market.

Published
2022-08-02
How to Cite
Ashiq Ali, & Abubakr Saeed. (2022). Nexus between Firm Risk and Gender Diversity in Foreign Operations. NUML International Journal of Business & Management, 17(1). https://doi.org/10.52015/nijbm.v17i1.82
Section
Articles