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Introduction
This paper examines the association between the gender of the firm's top executives and the corporate governance practices within the firm. The definition of corporate governance tends to vary based on discipline, but it can be broadly defined as "the study of power and influence over decision making within the corporation" (Aguilera and Jackson, 2010).
Economists, for instance, tend to see corporate governance as a combination of contracts among owners, while legal scholars define corporate governance as the set of legal, cultural, and institutional aspects that determine what companies can do and who controls them (Aguilera and Jackson, 2010). In addition, national practices, customs, laws, and policies influence the way a corporation is operated and governed.
Earlier literature has examined various attributes influencing corporate governance, but the impact of executive-specific characteristics has so far attracted surprisingly little attention from researchers. An executive may, for example, have a personal interest in reporting overly optimistic earnings, but the role of effective corporate governance practices is to ensure that reliable information is provided to the company's stakeholders. Previous studies indicate that the gender of the firm's executives and directors may affect corporate decision-making and, consequently, have implications for the firm's financial performance, market valuation, and financial reporting practices (see, e.g. Barua et al. , 2010; Huang and Kisgen, 2013; Erhardt et al. , 2003; Faccio et al. , 2016; Palvia et al. , 2015; Peni and Vähämaa, 2010). In relation to corporate boards, Kramer et al. (2006) suggest that increasing the representation of women on corporate boards may improve corporate governance practices.
In general, considerable empirical evidence documents that the characteristics of individual executives may affect corporate decisions and performance (see, e.g. Bertrand and Schoar, 2003; Malmendier and Tate, 2005; Malmendier et al. , 2011; Mande and Son, 2011; Tong, 2010). Moreover, the earlier literature suggests that corporate governance affects firm profitability and market value (see, e.g. Bebchuk et al. , 2009; Black et al. , 2015; Brown and Caylor, 2006, 2009; Gompers et al. , 2003; Renders et al. , 2010). Thus, investigating whether corporate governance practices are influenced by the gender-based differences between female and male executives is interesting.
Consequently, the purpose of this paper is to examine whether executive gender is associated with...