Corinne Post, chair of the department of management at Lehigh Business and her coauthors, had their paper, "The Influence of Female Directors on Product Recall Decisions," published in March of 2020.
Post and her coauthors say that the influence of female directors on company's decision-making and performance is a frequently studied research topic but has received limited attention in operations management. They investigated if adding female directors to a firm’s board of directors changes whether and how quickly the firm recalls defective products. They did this by analyzing 4,271 medical product recalls by 92 companies between 2002 and 2013.
By demonstrating a relationship between an increase in female directors and more rule-conscious, customer-focused recall decisions, they highlighted that adding female directors may enable more societally beneficial operational decisions. They found that as boards add female directors, recall decisions change. Firms initiate more medical product recalls that are low in severity and hence easier for firms to avoid initiating, highlighting the increased rule-following brought to bear by adding female directors.
Firms also make faster recall decisions for the most serious defects that are high in severity and dangerous for customers, highlighting the increased stakeholder responsiveness resulting from adding female directors.
The study concludes that firms may more closely align recall decisions with regulatory rules and become more sensitized to customer health and safety by adding female directors. Further, at least two female directors may be required to speed up recall decisions for the most serious, life-threatening defects.
More from Corinne Post on adding women to corporate boards: