Boardroom dynamics: The power of board composition and gender diversity in shaping capital structure

This study investigates the impact of board composition and gender diversity on capital structure using a dataset comprising 30 publicly traded Ghanaian firms from 2008 to 2018. By employing system generalized method moments (GMM) as analytical technique controlling for firm size profitability, unveils several noteworthy findings. Firstly, presence inside directors demonstrates significant negative influence leverage, aligning with principles agency theory, suggesting that privileged access internal information adopt cautious approach debt financing minimize conflicts between managers shareholders. Secondly, positive effect independent or outside leverage syncs resource dependency implying these bring valuable expertise perspectives firms’ decisions. Surprisingly, reveals boards exerts supporting gender-diverse enhance firm’s reputation attractiveness lenders. Moreover, indicating larger possess greater sources, reducing reliance external debt. Overall, underscores importance carefully considering optimal decisions, highlighting benefits maintaining balance promoting improved decision-making enhanced value.