Does Board Gender Diversity Affect Risk-Taking in Nigerian Banks? Empirical Evidence

Board gender diversity has attracted growing attention as a potential moderator of corporate risk-taking behaviour, but evidence from the Nigerian banking sector is absent from the empirical literature, representing a gap this study addresses. This study empirically examines whether board gender diversity affects risk-taking behaviour in Nigerian commercial banks for the period 2012 to 2022. Risk-taking was measured by risk-weighted asset density, loan growth volatility, and non-performing loan ratio. Board gender diversity was measured by the proportion of female directors on the board. Control variables included board size, CEO gender, bank size, capital adequacy, and profitability. Secondary data were extracted from the annual reports of fifteen commercial banks. Panel data regression with the generalised method of moments estimator was employed to account for dynamic endogeneity. Results showed that higher female board representation was significantly associated with lower risk-weighted asset density (coefficient = -0.034, p < 0.05) and lower non-performing loan ratio (coefficient = -0.019, p < 0.05). Loan growth volatility was also negatively related to female board proportion, though the effect was marginally significant. The relationship was stronger when women occupied board committee leadership positions, suggesting that formal authority amplifies the gender-risk effect. The study concludes that board gender diversity reduces risk appetite in Nigerian banking institutions, filling an empirical gap in the Nigerian corporate governance-risk literature, and recommends gender diversity targets in the Central Bank of Nigeria's corporate governance guidelines. Keywords: board gender diversity, bank risk-taking, corporate governance, Nigerian commercial banks, generalised method of moments