The Effect of Corporate Governance and Gender Diverse Board on the Lebanese Banks Financial and Social Performance

The main objective of this paper to find whether strong CG affects board composition with respect to gender diversity and if the latter have any effect on the corporate economic and social performance on the Lebanese banking sector. While the topic of women on board and corporate performance have received major attention in developed countries, very little research has been done in the Middle East region and in Lebanon exactly. Using data on the 66 Lebanese banks from 2008 to 2016, we examine the effect of women on board on the banks' financial and social performance. Regression analysis and ANOVA testing have been completed to test the hypothesis developed during the paper. With respect to corporate governance, the results show that the governance structure does not affect the status of women on board, nor does it affect the ROA or ROE of the bank. This could be attributed to the "tokenism" status as it shows that the number of women on banks' board all over Lebanon does not exceed 3 women in only one bank (years 2015, 2016) from the banks tested. However, it was noticed that the banks with the high ranking had higher CG-index than smaller banks. Regarding the effect of women on board to corporate performance, the results show that women on board have significant negative effect on the financial performance of the bank when measured by ROA, but with no effect when measured by ROE. On the other hand, regression results show that women on board have significant positive relationships on the corporate social performance of the banks.