Composition of Boards and Legislations

11. Discussion

The correlation analysis in table 10 can be used to support this discussion. As mentioned, all variables are positively correlated, with the exception of the relationship between CEO and CFO. The negative relationship between the role of CEO and CFO may indicate that the likelihood of females filling both positions is low. If a female fills one of the positions, the correlation results indicate that it is more likely that the other position is employed by a male. However, due to weak values we do not find a strong relationship on this matter. A positive correlation indicates that there is a positive relationship between the variables. Following this, it can be argued that female share in the board of directors will have a positive impact on female employment in the position of Chairman, CEO, and CFO. The relationship between BD and CFO, Chairman and CEO, or Chairman and CFO are low.

Consequently, it can also be argued that they are more or less not correlated based on a quantitative approach, not taking soft factors into consideration.

The second hypothesis suggests that countries with legislation have a higher female presence on the corporate boards. For this hypothesis to hold, the assumption is that the female share will be influenced and presumed higher due to the legislation. Norway was the first country to introduce legislation and have one of the strictest legislations to this day, with a legal requirement of 40%

female presence among the board of directors on all listed companies. Our analysis shows that Norwegian companies have the highest average female share in our dataset during the five years on the board of directors. Following this, even though there is no legal requirement within the management board or Chairman position, Norwegian companies has the highest average. Therefore, the findings indicate that the legislation have to some degree been efficient in perceiving gender equality. In the position of CEO and CFO, Norwegian companies have a low female share. It is unclear if this is due to the lack of legislation or just a coincidence. Hence, the legislation concerning the board of directors might not have an effect on executive positions.

Within the Nordic countries, our results find that Danish companies have the lowest ratio of gender diversity at the board of directors and the management board. Further, Danish companies have a low female share in the position of Chairman and CEO. With this, it can be argued that the lack of legislation in Denmark may be a reason for the low numbers. However, they have the highest share of females compared to the nine other countries in the CFO position. To compare the low gender diversity ratios in Denmark, we find that Swedish companies, which neither have legislation on gender quotas, have contradictory results. The Swedish companies have a high average percentage in the board of directors and management board. Based on the comparison of Danish and Swedish

11. Discussion

companies, the argument for the need for gender quota legislation to increase gender diversity is not justified.

Companies from the Netherlands, Belgium, Germany, and United Kingdom have relatively similar results, and in our analysis, they neither have the highest or lowest female share in the measured positions. Out of these, United Kingdom is the only one without legislation. Hence, the results indicate a minimal difference between countries with and without legislation. The companies from Austria and Switzerland have the lowest female share on the board of directors and management board. Of all the ten countries, the Austrian companies stand out, having an average female share of 3.62% on the management board. This indicates that the gender quota on the board of directors might not affect the management board. However, both Austria and Switzerland have recently introduced legislation, and it may be reasonable to assume that the effect will be more visually and measurable in the future.

Comparing the countries with and without legislation, the countries without legislation have a higher average female share than those with legal requirements in both the board of directors and management boards. The increase is more significant over the five years for the countries with legislation, this might be a reflection that several countries have introduced legislation in recent years, and as the legislation often comes with grace periods, the effect might not be visible. For instance, in Switzerland, the law was formally fully enforced as of the 1^st of January 2021. Based on this, it can be questioned if this thesis is ahead of time, as it is likely that the results of legislations will be more visible in a few years. Additionally, the SHE community has a goal of making the SHE index global within the next couple of years (SHE, 2021), while the UN sustainable development goals is set for 2030 (UN, 2021). As a consequence, the results of our analysis might be substantially different in a couple of years.

Based on the results of Norwegian companies, it may be argued that the legislations have had an effect. In contrast, Swedish companies have the similar proportions of females as Norwegian companies, and this has been accomplished without legislations. However, other countries without legislations do not have as high percentages as Sweden. This may indicate that the results may not be a consequence of the legislation itself, but rather a product of culture and other soft factors.

11. Discussion

11.1.1 Conclusion of Hypothesis 1 and 2

Based on our findings and discussion, the first hypothesis can neither be supported nor excluded.

Hence, the authors reject the hypothesis. The results show that an increased female share in the board of directors and management boards will make it more likely that a female fills Chairman, CEO, or CFO positions. This is supported by the literature (Perryman et al., 2016). However, the results of the correlation analysis are low, indicating a weak relationship. Further, the thesis does not find evidence to support the second hypothesis. Therefore, the second hypothesis is also rejected. Based on our results, the introduction of legislation cannot alone be said to have a considerable effect on female share. It is reasonable to assume that several factors affect the female share on the board of directors, management board, and executive positions.