Abstract
Governance mechanisms of religion-adhering firms
offer a great debate topic in contemporary business and finance
research. Though at nascent stages, yet there exists a growing body of
knowledge regarding Islamic corporate finance. With an emphasis
on this body of knowledge, the current study aims at examining the
relationship between gender diversity in corporate sector boards on
corporate choices of Shar¯ı‘ah compliant firms. Specifically, this
study examines whether gender diverse boards of Shar¯ı‘ah compliant
firms have any influence towards business diversification, dividend
pay-out, and firm’s financial performance or not? Study used data
from Karachi-Meezan Index (KMI-30) of Shar¯ı‘ahcompliant firms
and employed panel data analysis technique. Results of the study
show that gender diversity does matter for Shar¯ı‘ah compliant firms
too. Representation of women on boards of Shar¯ı‘ah compliant
firms results in more business diversification, dividend pay-out and
better financial performance. The results are robust and carry crucial
implications for policy makers of the Shar¯ı‘ah compliant firms,
regulators and the government. Results of the study suggest that
efforts should be deliberated to enhance women’s inclusion in boards
of Shar¯ı‘ah compliant firms. Our results must be interpreted with
caution as they only relate to a specific type of stocks i.e. Islamic
stocks and specific country i.e. an Islamic Republic of Pakistan.
Syed Danial Hashmi , Saqib Gulzar. (2020) Does Diversity Matter for Religious Firms Too? Board Gender Diversity and Corporate Choices of Shar¯ı‘ah Compliant Firms, Journal of Islamic Business and Management, Volume 10, Issue 1.
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