Bottom-up effects of female strategic leadership: Firm performance effects through employees

Deskripsi

Scholars have found that female representation in strategic leadership is often positively associated with firm performance, though the underlying mechanisms remain unclear. Prior explanations emphasize top-down effects, considering how female leaders shape strategic decision-making or influence legitimacy. We propose a complementary, bottom-up view: female top managers foster employee participation, which is positively associated with firm performance. Using a unique panel dataset from South Korea, we find that female representation in top management is linked to higher employee participation, which mediates its relationship with firm performance. The benefits of employee participation are especially pronounced in firms with innovation-oriented or labor-intensive strategies. By integrating micro-level employee behaviors with macro-level firm outcomes, our study shows how female strategic leaders contribute to firm performance through a top-enabled, bottom-up process.