Gender Diversity and Firm Performance: The Case of Portuguese Medium Firms

Abstract

Gender diversity on Boards of Directors (BoD) has gained increasing prominence in the literature, particularly in the context of corporate governance and financial performance. The present study examines whether there is a relationship between gender diversity on BoD and the financial performance of medium-sized, unlisted Portuguese industrial companies. A quantitative approach was adopted using panel data from 298 companies over the period 2018 to 2023. The results reveal that the majority of companies in the sample would not meet the minimum threshold of 33.33% female representation on boards, as established by the European Directive on gender balance. The findings do not indicate a significant association between either the presence or proportion of women on boards of directors and the main financial indicators analysed. Similarly, no significant relationship was found between female firm leadership and firm performance. The limited presence of women in leadership positions observed in the companies analysed may explain the absence of the positive effects highlighted in the literature. Nevertheless, the results should not be interpreted as a denial of the relevance of female leadership, but rather as a reflection of persistent structural gender inequality in medium-sized Portuguese companies.