Navigating ‘transformation pain’: the role of female board representation in moderating the U-shaped relationship between transforming capability and performance in Japan

This study examines how dynamic capabilities influence firm performance in Japan. Using integrated reports (N = 62), we identify a U-shaped relationship between transforming capability and operating profit margin, suggesting ‘transformation pain’ – an initial performance decline during reconfiguration. Crucially, female board representation significantly moderates this link, acting as a strategic buffer. Corporate values also positively impact performance. These findings suggest that this diversity enhances organizational resilience during structural renewal in the Japanese context.