As California Goes, So Goes the Nation? Board Gender Quotas and the Legislation of Non-Economic Values
Series
School of Finance Working Paper Series
Type
working paper
Date Issued
2019-12-19
Author(s)
Abstract
In 2018, California became the first U.S. state to introduce a mandatory board gender quota for all firms headquartered in the state. We document negative announcement returns to the adoption of the quota for Californian firms, but also large negative spillover effects on a matched group of non-Californian firms, particularly those located in states that followed California’s legislative lead in the past by raising minimum wages or legalizing cannabis. Frictions on the director labor market only explain a small fraction of value losses of Californian firms. They do not explain the negative spillover effects on firms in other states. We propose shareholders’ fear of further legislation of non-economic values as a new explanation for the negative announcement returns to gender quotas. In line with this view, we find that firms with higher policy sensitivity show the strongest reaction.
Language
English
Keywords
Gender quota
Regulation
Stakeholder perspective
HSG Classification
contribution to scientific community
HSG Profile Area
SOF - System-wide Risk in the Financial System
Publisher
SoF-HSG
Volume
2019
Number
2019/04
Pages
66
Division(s)
Contact Email Address
felix.meyerinck@unisg.ch
Eprints ID
258901
File(s)![Thumbnail Image]()
Name
19_04_Meyerinck et al_new As California Goes, so goes the nation.pdf
Size
2.23 MB
Format
Adobe PDF
Checksum (MD5)
89f781fcdd739c75580c136df58b1890