Female Board Appointments and Stock Price Reactions in the Italian Market

There is a vivid ongoing debate about the role of women on corporate boards (particularly top executive one) and their impact on companies' performance. The objective of this paper is to contribute to both theory and practice by exploring whether there are market reactions to-wards the appointment of women to corporate boards in Italy. A significant market reaction around the female board appointments would indicate the strategic importance of a female board member and her contribution to company’s future developments. Our dataset consists of 76 Italian companies that appoint women directors over the period 2012–2016. Using an event study methodology, the study examines the abnormal returns around the announcement day of a woman. Our results show not significant effects on days prior to the announcement; a positive significant effect on day 9; a negative significant effect on day 3. This could suggests that investors do not believe that the simple appointment of women directors would have a positive effect on the future performance of firms. Rather, such as the academic and practical literature highlights, the company’s performance and thus the stock returns can result influenced by the (male or female) directors’ attributes (i.e., education, skills, reputation, international experience, leadership style).