Using a newly compiled dataset of bank board membership from 1999 to 2018, Owen and her co-authors found that the professional networks within these boards are extensive. However, female board members are significantly less connected than male directors, both in number and length of connections.
Professional networks play an important role in determining the appointment of bank board directors and positively impact compensation for female directors, particularly when they have connections to other women. Female directors’ connections to other female directors have the largest positive effect on their compensation. Female directors’ connections to male directors also have a positive effect, but the effect is smaller. These results suggest that there are differences in the breadth, depth, and value of networks of male and female board members. These differences could also be a contributing reason for women’s ongoing underrepresentation on boards.
