We find that investors responded positively to a mandated gender quota in Korea, which requires large public firms to include at least one female director on their boards. Investor responses were more positive for firms with high risk, weak corporate governance, and poor social performance, suggesting that female management styles contribute at least in part to increases in value. Moreover, investors reacted more positively to firms whose directors have stronger social ties. Our results suggest that a mandated gender quota improves firm value when there is little gender diversity and that such improvement depends on firm and board characteristics.​

Keywords: boards of directors, female directors, rm value, gender diversity, female management style.

JEL classification: G34, G38, G14, K22​