Board Gender Diversity Regulation and Market Premium: A Comparative Analysis of Family and Non-Family Firms

The expanding debate on Corporate Governance (CG) within emerging markets such as India has heightened scholarly attention toward boardroom gender diversity and its impact on firm valuation. This study investigates whether stronger adherence to gender diversity requirements is associated with a valuation premium in the market, while comparatively analysing family and non-family firms in India. The analysis is based on a panel dataset comprising companies listed in the Nifty 200 index over a period of five financial years, with firm-level information sourced from the CMIE Prowess database. Market-based performance was proxied using the Market Value to Book Value (MV/BV) ratio as the dependent variable. Board gender diversity was operationalised through two measures: the presence of women directors and the proportion of women directors on the board. To examine the proposed relationships, regression models were estimated with appropriate controls for ownership structure and firm-specific characteristics to ensure robustness of results. The findings indicate that both the existence and a higher proportion of women directors significantly enhance firm valuation, suggesting that the market assigns a premium to gender-diverse boards. Additionally, family firm status demonstrates a positive association with firm value, implying that family firms benefit from relatively greater investor confidence. These results highlight the combined influence of ownership structure and board composition in shaping market perceptions. While the relationship between board gender diversity and firm performance has been extensively explored internationally, evidence on its valuation implications within the Indian context remains relatively sparse. This study contributes to the literature by simultaneously examining gender representation and family ownership within India’s CG framework. The findings also offer important policy insights, emphasizing that diversity initiatives may strengthen investor confidence alongside promoting inclusivity and broader economic advancement.