Board age and value diversity : evidence from a collectivistic and paternalistic culture

The current study investigates whether board age diversity affects company financial performance and risk, and whether diverse work-related values held by directors of different ages are the underlying cause of any effects via a sample of listed companies from Turkey, which has a collectivistic and paternalistic culture. In order to investigate these effects, various 2 Stage Least Squares Instrumental Variables models are employed. In addition, to investigate through which channels age diversity may affect company performance, directors' personal values are also considered via propensity score matching. Even though directors’ values are not observable, it is assumed that their ages reflect their values. For this purpose, the current study utilizes the World Value Survey data. The findings suggest that board age diversity has a positive effect on both company performance and risk, but do not suggest that intra-group conflicts in terms of work-related values are the underlying causes of this positive effect.