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Gender‐diverse boards and audit fees: What difference does gender quota legislation make?

Nekhili, Mehdi and Gull, Ammar Ali and Chtioui, Tawhid and Radhouane, Ikram (2020) 'Gender‐diverse boards and audit fees: What difference does gender quota legislation make?' Journal of Business Finance and Accounting, 47 (1-2). 52 - 99. ISSN 0306-686X

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Abstract

We investigate the effect of board (audit committee) gender diversity on audit fees in the French context. We also examine whether the relationship between the proportion of female directors and audit fees is moderated by the enactment of the gender quota law in 2011. We use the system GMM estimation approach on a matched sample of French firms listed in the SBF 120 index between 2002 and 2017. Consistent with the supply‐side perspective, we contend that female independent directors and female audit committee members, by improving board monitoring effectiveness, affect the auditor's assessment of audit risk, resulting in lower audit fees. Our findings also document that, by breaking the glass ceiling, the effectiveness of the gender quota law lies not in increasing the proportion of female insider directors, but in boosting the appointment of female independent directors and female audit committee members. Using the difference‐in‐difference approach, our results reveal that female independent directors and female audit committee members are more willing to assert their monitoring skills after the quota law, leading to lower audit fees. Moving beyond tokenism, we show that, after the quota law, the negative impact on non‐audit fees is strengthened only for female independent directors.

Item Type: Article
Divisions: Faculty of Social Sciences > Essex Business School > Essex Accounting Centre
Depositing User: Elements
Date Deposited: 13 Aug 2020 13:36
Last Modified: 16 Sep 2021 01:00
URI: http://repository.essex.ac.uk/id/eprint/28344

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