Corporate real estate investment and firm performance: moderating role of gender diversity
Aamir Inam Bhutta et al.
What the paper says
Purpose It is often argued that the presence of female on the board is related to lower agency costs and improved corporate governance. This study aims to examine how the presence of female directors shapes the relationship between corporate real estate investment and firm performance in an undeveloped market, Pakistan. Design/methodology/approach The study uses robust regression analyses that account for unobserved heterogeneity and endogeneity issues using fixed effects, generalized method of moments and sample matching techniques such as propensity score and entropy-balancing. The study uses a sample of 2,137 observations from 252 nonfinancial companies listed at the Pakistan Stock Exchange from 2010 to 2020. Findings The study finds that CRE investment decreases the firm performance. However, the presence of at least one female director on the board reverses this effect, resulting in a positive impact of CRE investment on firm performance. In addition, this positive effect is more pronounced when female directors are nonexecutive members of the board. These findings are robust after addressing endogeneity, incorporating additional controls and using alternative proxies. Practical implications The findings highlight the governance value of female representation, especially in nonexecutive roles, suggesting that greater gender diversity can enhance strategic investment decisions and firm performance. Originality/value To the best of the authors’ knowledge, this is the first study to examine how gender diversity moderates the CRE–performance relationship in a developing market, contributing to both real estate investment and corporate governance literature.
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.50 × 0.4 = 0.20 |
| M · momentum | 0.50 × 0.15 = 0.07 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.