Professor Oliver Rui and his co-authors, Douglas Cumming of York University Schulich School of Business and Tak Yan Leung from Open University of Hong Kong, examined the impact of gender difference on corporate fraud in China over a 10 year period (between 2001 and 2010). The researchers looked at data regarding enforcement action announcements made by the China Securities Regulatory Commission (CSRC) for regulatory and fraud violations committed by listed Chinese companies. Their findings show that a more gender-diverse board can help minimize the likelihood and severity of corporate fraud; thus the inclusion of more female board directors can be an effective anti-fraud control mechanism to set an ethical tone in the workplace.
The relative scarcity of women on boards of directors is a global issue. According to a study conduced by Catalyst in 2013, only 3 countries are over 20% (Norway, Sweden and Finland , while United State averaged 16.9%. Many European countries showed under 10% (Switzerland, Spain, Italy,..). 13 countries had less than 5% with Saudi Arabia the lowest at 0.1%.
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**The research results appear in a paper entitled “Gender Diversity and Securities Fraud”. The paper received the 11th Eurasia Business and Economics Society (EBES) Conference Best Paper Award given at the Conference in Ekaterinburg, Russia in September, 2013.