The Impact of Board Gender Diversity on Capital Structure and Risk-Taking: Evidence from Swedish Listed Companies

Abstract

Using a panel of 3,468 Swedish listed firm–year observations from 2010–2023, this thesis examines how board gender diversity affects corporate risk-taking and policy decision making. Employing OLS with industry and year fixed effects, this study observes no significant correlation between female board representation and leverage or earnings volatility, however, there exists a robust negative relationship with capital expenditures. This investment-based risk reduction is driven by independent female directors; however, there is no evidence of a critical mass threshold. Robustness and validity checks, including instrumental variables, lagged regressors, and propensity-score matching, confirm the findings of capital expenditures. This study highlights the role of gender diversity in moderating investment risk, forming governance policy, and the broader literature on board composition.