The Financial Performance and the Impact of Gender Diversity in the High Management – Insights from the Banking Sector in Albania

Recently, the relationship between gender diversity and financial performance has become an important and controversial topic within the area of corporate governance. The purpose of this research is to explore the ongoing issue of gender diversity in the banking industry in Albania by paying attention to the impact of women as directors and senior managers on the organization's performance, aiming to find out if there is a relationship between gender diversity and organization performance. For this research, the authors have studied all the banks currently operating in Albania (11 banks in total) for a period of five years (2018 to 2022). The data related to the performance of the banks was collected by the annual reports published on the websites of the banks. ROA, ROE, and Net Profit were selected as indicators to measure the bank's performance with the percentage of women on boards, the percentage of women as senior managers, and the percentage of total women employed used to measure gender diversity and the board size as a control variable. The use of the regression model suggested that a higher presence of women in top leadership positions may not have the expected positive impact on the financial performance of banks, potentially due to factors like cultural barriers or tokenism. However, a higher proportion of women in the workforce was positively linked to better financial performance, indicating that women’s broader integration into the organization contributes to its success.