Whether at the micro level such as firms or macro level like countries improvement in performance is a

vital matter. Therefore evaluating the performance of firms has always been the focus of scholars. The
effect of gender diversity on a firm's performance has received much attention in recent years.
Numerous studies in the past thirty years across different region and different industries shows female
directorship has a positive impact on a firm's performance (S.M. Hussain et al. 2023). It should be
mentioned that performance is dynamic (M. Lebans, 2006) and it requires to be analyzed in a historical
context. Although there is no consensus on the definition and measures of a firm's performance among
scholars (Omar Taouab,2019), the conventional approach for measuring the performance was financial
measures such as ROA, ROE, annual sales growth, annual productivity growth, profitability (S.M.
Hussain et al, 2023; Drik Dohse et al, 2018; and Issam Abdo Ahmad et al, 2021). Differences in gender
attitudes toward risk-taking could explain the positive relationship of female managers concerning a
firm's performance (Byrnes et al., 1999; Carpenter, 2002.). But this is not the necessary and sufficient
condition, other factors such as region, market structures, the organizational structure of the firm, etc.
For instance, in the top 100 papers on the impact of female directors on firm performance, 9 papers
reported a negative impact (S.M. Hussain et al.). Another paper by Corinne Post and Kris Byron (2015)
reviews 140 papers on the relationship between a firm's performance and women on the board and
concludes that female board representation is positively related to a firm's ROA&ROE, and it is more
favorable in countries with strong shareholder protection. Since the relationship between a firm's
performance and female participants on board varies across countries due to differences in institutional
structure, market structure, and firms' organizational structure. In this article, we have tried to analyze
the relationship between gender and firm performance in South Asian Countries. For this purpose, we
use World Bank Enterprise Survey data for the year 2022. It should be noted that since the conceptual
scope of the definitions of the measure of performance and share of female participants in the business
(female representation on board) are wide this study's definitions are limited to the definitions of the
questionnaires of the data from WBES. The rest of the paper is organized as follows. Section 2, presents
the theoretical background and definition, and section 3, followed by data, model, results, and
discussion.
2. Theoretical Background and Definition

2.1 Theoretical background

A more relevant theory for explaining the differences in a firm's outcome and board gender diversity
(Corinne Post and Kris Byron, 2015) is the Upper Echelons Theory (Hambrick and Mason, 1984). Which
state that a firm's top-level managers' idiosyncratic characteristics (e.g., cognitive) play a key role in
explaining the organizational outcome and performance. Obtaining psychometric data from an
individual's cognition is difficult (Nielsen, 2013), but considering that individuals' cognition is shaped by
their life experience( Cyert and March, 1963), demographic variables such as age, education, career
experience, financial position, gender, socio-economic background thought to be a reliable indicator of
cognition (Carpenter, Geletkanycz&Sanders, 2004; Wiersema &Bantel, 1992; Krishnan &park, 2005).

With regard to gender and its relationship with a firm's performance studies have come to mixed
conclusions. Carter et al (2003) in an article titled “Corporate governance, board diversity, and firm
value” using data from 1000 firms for the year 1997, found a significant positive relationship between
female board participants and firm value. Campbell and Minguez -Vera (2008) studies in Spain show
female participation on board has a positive impact on a firm's financial performance. Siri Terjesen et al.
(2016) Using data from 47 countries state that firms with female directors have higher returns on assets.
A study by Moez Bennouri et al. (2018) in France for a period of found that there is a positive
relationship between accounting performance and female directorship. Another study by Issam and Ali
Fakih (2021) in the MENA region shows that female participants in ownership have a positive impact on
a firm's performance. Inmaculada Martinez-Zarzoso (2023) In an article entitled” female top managers
and firm performance “ using WBES data for the year 2016, the result shows that when a firm is owned
by a male and the top manager of the firm is female the firm tends to have a higher average labor
productivity. He argues that male-owned firms belong to a male-dominated corporate culture and they
would only choose a female manager if she is more qualified than the potential male candidates. Drik
Dohse et al.(2019) investigate who is more adept at implementing innovation female manager or female
owner. Using WBES data for the year 2016, their study indicates that female owners were more likely to
introduce innovation than female managers. Most of the existing studies are done in developed
countries and the structure of organizations are different and female owner or participant on board
have no role in management (Aterido et al., 2011). Since this study is based on the World Bank
Enterprise Survey (WBES) and almost 90% of the firms in this region are not in the stock market and
70.8% of female managers are also the owners of the firm. (Table-1, and Table-2). And we assume the
decision would be taken by the Top managers of the firms.
Table-1: Ownership structure
Germany India Pakistan Bangladesh
Shareholder company with shares traded 1.83 5.07 2.10 0.80
Shareholder company with non-traded shares 61.75 6.12 3.77 4.41
Sole proprietorship 11.69 62.64 62.46 72.75
Partnership 2.42 14.99 30.00 21.04
Limited partnership 22.08 11.19 1.62 0.80

Source: World Bank Enterprise Survey, 2022.

Table 2: Female Manager& Owner

India Pakistan Bangladesh
Female Manager& Owner (%) 78.0 44.6 90.0
Female manager & not Owner(%) 21..7 55.3 10.0
Source: World Bank Enterprise Survey, 2022.

We formulate our Hypothesis as follows:

H0: Ceteris paribus, on average firm performance, does not differ concerning the genders of the firm's
manager.

2.2 Definition

Performance is an abstract concept (Mayne and Zapico-Goni 1997) and with different contexts, it would
get different meanings. Firm performance is the ability of an organization to obtain its objective
efficiently (Peterson, Gijsbers, and Wilks, 2003). In the WBES dataset information for the assets and
equity of firms are not available due to this our study is limited to the use of annual sales growth, labor
growth, and labor productivity as indicators of the financial performance of the firm.
3. Data, model, results, and discussion

3.1 Data

The primary source of data for this study is from World Bank Enterprise Survey (WBES) which was
collected in 2022 for India, Pakistan, and Bangladesh through a stratified random sampling. WBES collect
data from different aspect of the business environment across 155 countries around the world and
offers a wide range of economics data for different topic by surveying owners and top managers of
different enterprise (micro, small and medium). The dependent variable for the study is the firm
performance which is measured by labor productivity, sales growth, and employment growth. The
explanatory variable is the firm's top manager's gender which is a binary variable that takes values 1(if
top manager is female) and 2(if top-manger is male). The control variables are firm size, number of
employees, the structure of the firm, overdraft facility, introducing new products or services in the
market, and export. Table 3 shows the summary statistics of the variables used in the study.

Table 3: Summary statistics

Mean St. Deviation
Dependent variables Ind. Pak. Bang. Ind. Pak. Bang.
Sales growth (%) 0.30 0.57 0.78 1.02 2.51 4.44
Labor growth (%) 2.2 11.7
Labor productivity (%) 558.3 698.6 535.2 192.2 222.6 197.6
Independent variable
Female manager (binary variable) 1.91 1.95 1.96 0.45 0.35 0.17

Control variables
Legal status (categorical variable with five level) 3.21 3.24 3.14 0.90 0.73 0.76
Shareholding company with traded share
Shareholding company with non-traded share
Sole proprietorship
Partnership
Limited partnership
No. of employees 98.5 99.4 142.5 645.0 314.5 498.3
New product & service (binary variable) 1.95 1.96 1.96 0.30 0.18 0.60
Overdraft facility (binary variable) 1.33 1.38 0.29 0.80 1.47 3.84
Size (categorical variable with three level) 1.93 1.82 1.81 0.82 0.78 0.78
Export (categorical variable with three level) 1.16 1.74 1.61 2.33 0.85 1.26
3.2 Model

To address the study's main question a regression model is introduced as such the dependent variables
are sales growth, labor growth, and labor productivity

ln(sale growth)i = β0 +β1X1+β2(X1*X2)+βijZij+Ɛij

ln(labor growth)i = β0 +β1X1+β2(X1*X2)+βijZij+Ɛij

ln(labor productivity)i = β0 +β1X1+β2(X1*X2)+βijZij+Ɛij

Where X1 denotes a female manager in a firm (it is a binary variable), X2 denotes introducing a new
product or service in a market it is also a binary variable, and Zij denotes other control variables. Since
the independent variables in the model are binary variables the regression would tell us how much the
independent variable on average would change with respect to changes in binary variables from one
level to another. We introduce an interactive variable in the model(X1*X2) it enables us to see how
gender and innovativeness together respond to a firm's performance.

3.3 Result

The result of the study is shown in (Tables 4, 5, and 6) respectively for India Pakistan, and Bangladesh.
Based on the test result, the null hypothesis (on average a firm’s performance does not change with a
change in gender of a firm’s manager) is rejected within the 1% level of significance for all three
countries. Table 4 shows when the firm’s top manager is female the average performance is 0.893 and
1,122.375 respectively for sales growth and labor productivity and it will change to -0.920 and -9.105
when the top manager is male which means firms with a female manager would have better
performance compare to firms having a male manager. Table 5 shows when a firm’s top manager is
female on average the performance of the firm is 6.877 and 1,224.055 respectively for sales growth and
labor productivity and will change to -5.129 and -3.147 when the firm's top manager is male. Similarly,
table 6 indicates when the firm’s top manager is female the performance is 14.260 and 1164.903 for
sales growth and labor productivity respectively, and would change to -16.294 and -3.228. Also, the
interactive variable in Table 4 when the firm’s manager is female and introduces a new product or
service the average performance is 0.893 and 1,122.375 respectively for sales growth and labor
productivity, and when there is no female manager the average performance change to 0.997 and
23.635. This means despite the gender differences innovativeness is positively associated with a firm’s
performance.
Table 4: Regression result India
Sales growth Labor Productivity

Female manager -0.920*** -9.165***

(0.325) (4.356)
Female manager & Innovativeness 0.997*** 23.635***
(0.340) (11.169)
Shareholding company with non-traded share 0.008 -10.446**
(0.149) (4.890)
Sole proprietorship -0.026 -24.986***
(0.117) (3.855)
Partnership -0.116 -23.669***
(0.128) (4.209)
Limited partnership -0.051 -9.165***
(0.133) (4.365)
No. of employees 0.156*** -149.878***
(0.047) (1.558)
New product & service -1.330*** -9.657
(0.312) (10.254)
Overdraft facility

Size (medium) 0.338*** -38.236***

(0.091) (2.980)
Size (Large) 0.014 79.619***
(0.156) (5.111)
Export (no)

Export (yes)

Constant 0.893*** 1,122.375***

(0.336) (11.030)
No. of Obs. 9,374 9,374
Adjusted R2 0.014 0.833
Note: Robust standard error in parentheses, with * p<0.10, ** p<0.05, *** p<0.01.
Table 5: Regression result Pakistan
Sales growth Labor growth Labor Productivity

Female manager -5.129*** 4.104 -31.147**

(1.255) (4.572) (15.284)
Female manager & Innovativeness 4.127*** -4.447
(1.287) (4.687)
Shareholding company with non-traded share -1.732*** -4.233* -76.059***
(0.601) (2.188) (21.728)
Sole proprietorship -1.664*** -3.337* -136.696***
(0.556) (2.026) (20.014)
Partnership -1.796*** -4.123** -125.986**
(0.554) (2.017) (19.904)
Limited partnership -2.263*** -3.640 -126.509***
(0.728) (2.653) (26.252)
No. of employees 0.083 -0.227 -124.629***
(0.123) (0.449) (4.462)
New product & service -4.355*** 3.636 -10.236
(1.223) (4.452) (14.896)
Overdraft facility -0.079 -0.473 -16.396
(0.142) (0.519) (29.381)
Size (medium) 0.265 0.707 -89.019***
(0.240) (0.874) (8.695)
Size (large) 0.225 -0.132 -33.743
(0.390) (1.420) (14.133)
Export (no) 0.229 0.970 11.388*
(0.165) (0.599) (5.964)
Export (yes) 0.102 1.067 21.852***
(0.242) (0.882) (8.790)
Constant 6.877*** 2.136 1,224.055***
(1.294) (4.712) (30.512)
No. of Obs. 847 847 847
Adjusted R2 0.076 -0.0002 0.839
Note: Robust standard error in parentheses, with * p<0.10, ** p<0.05, *** p<0.01.
Table 6: Regression results Bangladesh
Sales growth Labor growth Labor Productivity

Female manager -16.294*** -5.923** -3.228

(5.100) (2.826) (24.898)
Female manager & Innovativeness 15.755***
(5.170)
Shareholding company with non-traded share 2.062 1.028 -152.523**
(1.550) (7.960) (70.134)
Sole proprietorship 2.237 2.210 -130.625**
(1.413) (7.404) (65.228)
Partnership 2.192 1.252 -128.849**
(1.433) (7.446) (65.599)
Limited partnership 2.654 2.050 -150.282*
(2.103) (8.689) (76.551)
No. of employees 0.261 0.474 -116.629***
(0.204) (0.747) (6.580)
New product & service -16.252*** -0.142 -9.205
(4.493) (12.343) (108.745)
Overdraft facility 0.236 -0.908 -22.022
(0.404) (1.944) (17.127)
Size (medium) -0.211 -1.914 -95.756***
(0.403) (1.600) (14.093)
Size (large) -0.159 -0.902 -22.502
(0.789) (2.813) (24.779)
Export (no) -0.622 7.786
(1.234) (10.875)
Export (yes) -1.594 63.905***
(2.036) (17.939)
Constant 14.260*** 4.849 1,164.903***
(4.682) (15.080) (132.855)
No. of Obs. 998 544 544
Adjusted R2 0.016 -0.010 0.736
Note: Robust standard error in parentheses, with * p<0.10, ** p<0.05, *** p<0.01.
3.4 Discussion
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