Migration Of Corporate Governance In Hedge Accounting In Financial Reporting: A Systematic Literature Review

Abstract

In the most recent decades, the continuous academic debate over the economic and financial ramifications of board gender diversity (BGD) has not been definitively resolved. Most research focuses solely on gender diversity-induced financial performance measuring the achievement of observed financial ratios while little research has examined the effects of BGD on non-financial performance aspects such as the quality of financial statements measuring the credibility of information provided. Additionally, demographic differences such as nationalities will create cultural diversity in the boardroom leading to different acceptable standards by the respective board of directors. These determinants are important to investigate in order to comprehensively comprehend the influence of BGD on a company's financial success (Laique et al., 2023). The fundamental responsibility of the board of directors of a firm is to provide strategic counsel in decision-making by attempting to strike a balance between the interests of management and shareholders (Finkelstein et al., 2009). A perceptive corporate board acts as a significant strategic asset, enabling firms to achieve a competitive edge in the market by utilizing expertise, experience, and corporate networks (Palmberg et al., 2009). The importance of BGD in enhancing corporate performance and enhancing risk management and governance has been supported by a considerable body of older literature and the assumption that female directors tend to demonstrate risk aversion and ethical behavior is the primary justification for BGD's positive influence towards financial reporting quality (Chen et al., 2016) (Guizani & Abdalkrim, 2022).