The influence of gender composition in top leadership on female CEO succession: Evidence of gender spillovers in Finnish stock listed firms
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School of Business |
Master's thesis
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Authors
Garant, Anna
Date
2020
Department
Major/Subject
Mcode
Degree programme
Management and International Business (MIB)
Language
en
Pages
95
Series
Abstract
Finland performs amongst the top countries in gender equality on boards of directors, with an average female representation of 29% in publicly traded firms. In addition, 24% of executive team members in these firms are women. However, the alarmingly low share of female CEOs (8.9%) constitutes an issue for firms, as they may not be deploying the best available talent. Gender inequality in top leadership also has societal implications, as global competitiveness requires the private sector to utilize resources in an optimal way. The purpose of this study is to explain how the likelihood of female CEO succession is affected by the gender composition of the board of directors and executive teams. The focus is on CEO successions which occurred in publicly traded Finnish companies between the years 2015-2019. Data on 115 CEO successions were collected from the annual reports of 73 firms listed on the Helsinki Stock Exchange. During the timeframe, 15 women were appointed to the CEO position. Using binary logistic regression, a significant positive relationship was found between the likelihood of female CEO succession and the number of female directors and female executives. This indicates that increasing the number of female CEOs requires systematic improvement in gender composition of executive teams and boards. These findings contribute to the literature by showing that instead of the number of female directors impacting female CEO succession in isolation, the joint effect of female directors and executives has a significant impact on the process. In terms of managerial implications, the findings suggest that by systematically supporting equal career development, managers can ultimately enhance equality in the top leadership.Description
Thesis advisor
Piekkari, RebeccaJi, Young
Keywords
women on boards, female CEO, CEO succession, leadership diversity, Finland