The cascade effect of women on boards: how firm-level gender diversity management develops intellectual capital

Purpose Building on the resource-based view and human capital theory, this paper aims to extend the effects of gender diversity from the board level to the entire organizational level and investigates the impact of diversity and inclusion management practices on a firm’s intellectual capital performance. Conceptually, this study adopts the value-added intellectual coefficient (VAIC) construct and disentangles intellectual capital into its threefold dimensions of human capital, structural capital, and capital employed efficiency - HCE, SCE, CEE, respectively. Specifically, this study explores the effects of three categories of formalized gender diversity management practices – namely recruitment, retention, and training and development – while also considering the supporting role of governance structures and organizational infrastructures as a driver of the overall efficiency and value of intellectual capital. Design/methodology/approach This study analyzes a sample of 72 firm-year observations associated with 36 Italian companies listed on the Stoxx Italy-45 in the 2018–2019 period and runs multiple linear regression models. Findings Our findings indicate that a firm’s specific bundle of diversity management practices positively influences intellectual capital performance. By adopting a granular approach on both intellectual capital and diversity management, this study also sheds light on how different intellectual capital components are distinctly affected by varying diversity management practices. Originality/value This study enhances the understanding of how gender diversity management practices affect a firm’s intellectual capital, revealing the potential benefits of implementing formalized diversity and inclusion initiatives across multiple organizational levels, spreading from the boardroom to the entire organization.