Does board gender diversity have a financial impact?

The Australian Securities Exchange has recently required that companies disclose their diversity practices and recommended that listed entities have a gender diversity policy at the board, management and operational levels. Currently, there is no consensus on the impact of diversity on financial performance. To date the literature has taken a firm-level approach and has been plagued by heterogeneity in company specific information. In contrast, we take a market level approach to empirically examine whether women directors add tangible value to the capital market. The outcomes of this research will inform the regulatory debate on gender diversity in the board room.