Institutional investors, non-mandatory regulations, and board gender diversity

This study investigates the interaction between institutional investors and non-mandatory regulations, specifically, their impact on board gender diversity. Using a sample of UK FTSE All-Share firms from 2000 to 2017, we find that higher institutional ownership leads to higher female director representation on boards. We also find that this effect is more pronounced after the Davies intervention, a campaign promoting gender balance on British corporate boards. The findings highlight the complementary role of institutional investors and the Davies intervention in shaping board gender diversity, thereby offering insightful implications for shareholder perspectives and demand for board diversity.