Gender of a manager and firm performance in Africa: Does the business environment play a moderating role?

Abstract

This study explores the moderating role of the business environment in the relationship between top manager gender and firm performance, using firm-level data from 29 African countries. Controlling for endogeneity and country fixed effects, we find that female-managed firms generally underperform male-managed firms, except among large firms where female managers excel. The performance gap is exacerbated by a weak business environment, highlighting the need for reforms to close the managerial gender gap in Africa. Strengthening the business environment is essential for improving female-led firm performance and by extension promoting gender equality in African business leadership.