National Culture and Women Managers: Evidence from Microfinance Institutions around the World

We investigate the effect of national culture on women manager appointments. We argue that culture influences women manager appointments through their effects on managerial decision-making. Using firm-level data on 2456 microfinance institutions (MFIs) across 61 countries, we document that fewer women managers are appointed in societies high on individualism and uncertainty avoidance. On the contrary, high power distance societies are positively associated with the appointment of women managers. We demonstrate that a greater number of women non-managers reduces (increases) the appointment of women managers in high individualistic (uncertainty avoidance) cultures. Our findings challenge the “one size fit all” approach adopted by policymakers around the world to increase women manager appointments. Our results are robust to endogeneity.