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Internal dealings might shape female directors’ incentives to affect corporate financial policies. This study aims to explore what impact female directors have on corporate cash holdings in the presence of internal dealings.

The authors apply panel data regressions that allow them to address endogeneity concerns. The initial sample includes all non-financial Spanish listed firms from 2005 to 2019.

Conditional on the existence of internal dealings, the authors show that the presence of two or more female directors decreases corporate cash holdings. Results seem consistent, with independent female directors becoming an effective monitoring mechanism for corporate financial policies in the presence of internal dealings. Furthermore, the findings could be explained by independent female directors providing valuable resources and external linkages, which, in the presence of internal dealings, help to reduce the firm’s need to hold cash to cope with external uncertainties.

The results provide practical implications by suggesting that in the presence of internal dealings, regulators and policy makers should pay greater attention to board gender diversity so as to reduce agency problems associated with free cash flows. The authors also contribute to prior academic debate regarding the importance of female directors in providing critical resources and external linkages to cope with uncertainty and to the importance of considering not only the presence of women on boards but also their number and specific roles.

The authors' work meets the increasing demand for more research on gender diversity to better capture the potential benefits that may result from appointing women on boards. To the best of the authors' knowledge, this is the first study to examine the influence of female directors on corporate cash holdings in the presence of internal dealings.

This study aims to analyse the effect of related party transactions (RPTs) on earnings quality in a sample of Spanish listed firms, as well as the moderating role played by female directors in the relationship between RPTs and earnings quality.

The sample includes non-financial Spanish listed firms from 2005 to 2019. The authors use panel data analysis based on the firm fixed-effect estimator. Additionally, the authors use the two-step system generalized method of moments estimator to test the robustness of the results.

The results show a negative effect of RPTs on earnings quality. Further analysis reveals that the negative effect is mainly driven by transactions between the firm and its directors and major shareholders, as well as by RPTs that are more likely to reflect insiders’ self-interest. Moreover, the authors show that the presence of female directors reduces the negative impact of RPTs on earnings quality.

The study provides practical implications for investors, auditors and policymakers, who should be aware that RPTs might harm earnings quality and adversely affect the flow of financial capital to promising investment opportunities. Additionally, the study evidences the key governance role played by female directors regarding financial reporting policies as RPTs increase.

The findings promote the need for a higher representation of women in leadership positions since the authors reveal the key governance role played by female directors regarding financial reporting policies as RPTs increase.

The results to emerge from the study complement available evidence concerning the effect of RPTs on earnings quality in a continental European country. The authors also provide novel evidence vis-à-vis the role of female directors in the relationship between RPTs and earnings quality.

This study aims to analyse the political connections of Portuguese companies through the members of the board of directors, exploring how these connections influence, in particular, the composition and characteristics of the boards.

The research used a strategy based on analysing the financial statements and curriculum vitae of the directors of Portuguese companies listed on Euronext Lisbon from 2014 to 2019. The political connections of board members were examined, considering the variables identified in the existing literature.

The results indicate that companies with political connections maintain these relationships for long periods and have a greater number of members on the board of directors compared to companies without such connections. Directors with political experience tend to occupy non-executive positions, suggesting that companies may value political contacts more than the management skills of these directors. It was also found that there are politically connected directors who belong to multiple boards and that women appointed to the board are less likely to have a political background, reflecting male dominance in Portuguese politics.

The main limitations of this study include the small number of listed companies in the sample, which may affect the statistical robustness of the results, as well as the use of secondary sources, which may not capture all relevant policy linkages. In addition, the results are specific to the Portuguese context and may not be generalisable to other countries or other regions of the world.

This study contributes to the understanding of political connections in Portuguese companies, offering valuable insights into how these connections influence board composition and can impact corporate strategy and governance. The findings of this study can be especially useful for business leaders looking to optimise the formation of their boards of directors.