Rizqa Anita^1*, Nurmala Sari², Agus Seswandi³, Muhammad Rasyid Abdillah³ and Nor Balkish Zakaria⁴

^1,3,4Universitas Lancang Kuning, Pekanbaru, Indonesia
²Universitas Rokania, Rokan Hulu, Indonesia
⁵Universiti Teknologi MARA, Shah Alam, Malaysia

ABSTRACT

The increasing focus on gender diversity in corporate boards highlights the impact of female directors on corporate governance practices and their ability to enhance firm value through effective oversight and risk disclosure. Despite the strategic importance of corporate risk disclosure in emerging markets, many firms in Indonesia still lack comprehensive reporting, limiting investor confidence and firm value. This study aimed to investigate the influence of female directors on firm value and the mediating role of corporate risk disclosure in this relationship. Using a balanced panel dataset comprising 884 observations from non-financial firms listed on the Indonesia Stock Exchange, this study employed Partial Least Squares (PLS) for hypothesis testing and path analysis. The findings revealed a positive impact of female directors on firm value, mediated by corporate risk disclosure. Female directors improved governance by promoting transparency and signaling risk management capabilities to investors, consistent with signaling theory. These results provide actionable insights for policymakers to enhance board diversity as a strategy for value creation in emerging economies.

Keywords:
Female Directors
Corporate Risk Disclosure
Firm Value