Women on CEO-Only Boards and ROAA

Abstract

Women on the Board (WOB) have been increasing both in the United States and Europe and much of the research to date is not U.S. focused. This paper studies the impacts of WOB on Return on Average Assets (ROAA). We employ different panel data models to investigate the impacts on 145 S&P 500 CEO-only board companies between 2016 and 2019. CEO-only board companies have a type of board that developed as a result of the Sarbanes-Oxley Act of 2002 to be a fully independent board other than the CEO. Our results illustrate positive impacts of WOB on ROAA when controlling for sector, time and state fixed effects. Moreover, interest rate has a positive and statistically significant impact on ROAA. Additionally, we study the cultural impacts of Red vs. Blue states. Our results support a positive impact of WOB on ROAA in favor of Blue states.