The impact of top management team members diversity on corporations’ performance and value: evidence from emerging markets

The study contributes to understanding the impact of top management team (TMT) member diversity on corpora-tions’ performance and value in emerging markets. It examines three dimensions of diversity in TMT: gender, education, and foreign nationalities, providing insights into how these factors influence corporate performance and value. The study’s quantitative analysis of 70 non-financial corporations from Brazil, Egypt, India, Russia, Saudi Arabia, South Africa, and Turkey from 2013 to 2022 using cross-sectional unit analyzes helps establish empirical evidence on the relationship between TMT diversity and corporate performance in emerging markets. Study’s findings can inform corporations in emerging markets about the importance of promoting diversity in their top management teams to improve performance and value. The study found a significant impact of top management team diversity based on education and foreign nationalities but a non-significant impact on gender on some key performance indicators (KPIs). The study can explain the non-significant impact of gender according to shifting the prevailing theory from sexual selection theory to prospect theory. On the other hand, the study believes that the optimal mass of diversification, or the weight of members with diverse backgrounds, determines whether the impact of diversification is positive (it leads to increased creativity, innovation, problem-solving ability, talent attraction and retention, and employee engagement and productivity) or negative (it leads to increased organizational conflict and communication difficulties). If it is less than this mass, the benefits of diversity are limited, but if the mass is greater than it, the harms of diversity are greater than the benefits. The study also highlights the need for future research in the area of diversity in top management and provides a plan outlining steps to enhance diversity in top management teams.


Introduction
Top management team (TMT) member diversity has emerged as a critical corporate strategy that plays a pivotal role in enhancing a corporation's overall performance and sustainable competitive advantage [146].As corporations continue to operate in an increasingly globalized and diverse business environment, the effective management of diverse workforces has become an essential factor in ensuring long-term success and economic growth [43].While the significance of TMT member diversity has been widely recognized in developed markets [38], its impact in the context of emerging markets has garnered relatively less attention.Therefore, this study aims to bridge this gap in knowledge by examining how TMT members diversity contributes to the generation of financial benefits for common stockholders in emerging market settings.
The concept of diversity in the top management team of corporations has gained increasing attention in recent years.This attention stems from the growing recognition that diverse perspectives and experiences in decisionmaking processes can lead to improved performance and value for corporations.Research and studies have consistently shown that having a diverse top management team can positively impact the performance and value of corporations [33,56,127,133].
Maximizing the wealth of shareholders is the long-term goal of the TMT [145].This goal has become generally accepted by academics and professionals, not only at the level of international markets but also in emerging markets [23].Everyone has come to view this goal according to many financial theories and models, including "agency theory" [50,92,114] and "upper echelon theory" [3,55,69,95,147].
The problem of the difference in benefits between TMT members and the common's stockholders leads to the emergence of agency costs, and this supports" the agency theory" that was presented by Adam Smith [137].In contrast, this was the "upper echelon theory" that was presented by Hambrick and Mason [69].Under the upper echelon theory, corporations are said to be a reflection of their top management team members [44,64,142], as the characteristics of TMT members are determinants of a corporation's strategic choices and consequently its performance.
But top management team (TMT) members are often under working capital management in the short term and sometimes under capital structure and capital budget in the long term, making suboptimal choices based on return measurements like return on assets (ROA) or return on equity (ROE).In addition, neither profitability nor return indicators correlate well with the actual market value of a corporation [154].This has led academics to look into other metrics to explain the performance of financial instruments, especially common stocks, according to their market value, examples of which include economic value added [87,130,164] and managerial ability [10,45,120].
The study does not adopt managerial ability as a measure to explain the performance of corporations and their common stocks, as the basis for building the concept of estimating managerial ability is a benchmark between the same industries by identifying the best performers [52].Therefore, this measure is limited to one industry and cannot be applied to all stocks listed on the stock exchange.but the economic value added (EVA) model and Tobin's Q are financial metrics that are used to measure a corporation's performance based on the idea that a corporation creates value for its shareholders only when it earns a rate of return that exceeds the cost of capital [87,130,164].Therefore, this measure can be applied to all stocks listed on the stock exchange.From the above, the current study can adopt economic value added and Tobin's Q.
Prior research utilizes social psychology theories to elucidate the primary impact of top management team (TMT) diversity on corporation's performance [76,125].Two contradictory theoretical reasons are presented in the literature.One explanation is grounded in social categorization theory [94,138,152] and the similarity-attraction paradigm [28,128].These ideas contend that the variety of top management teams (TMT) has a detrimental impact on the performance of corporations.The idea of social categorization posits that individuals in a workgroup tend to classify themselves and others into subgroups based on shared characteristics or distinctions.This process allows for the distinction between members who are similar (in-group) and those who are different (out-group).Individuals often exhibit a tendency to distinguish between various subgroups by showing more approval toward those inside their own group rather to those outside of it.Additionally, they are more inclined to engage in cooperative behavior with individuals belonging to their own subgroup.This phenomenon has been observed by van Knippenberg and Schippers in [153].The similarityattraction paradigm suggests that when individuals have similar qualities, it enhances their interpersonal attraction and strengthens their bonds.Individuals that have comparable origins are likely to have shared life experiences and ideals.As a result, they often find it simpler, more positively reinforcing, and more desirable to engage with one another [163].Similarity serves as a source of positive reinforcement for one's own attitudes and views, whereas dissimilarity is seen as a challenge.Therefore, the presence of diversity among members of a workgroup may result in decreased communication, distortion of messages, and an increased likelihood of communication mistakes [163].
Top management team (TMT) member diversity has varying impacts on corporations.So, the current study investigates the impact of top management team (TMT) member diversity on corporations' performance and value, according to the controversy over the pattern of this impact?There are those who point to the positive impact of top management team (TMT) member diversity [27,32,135].Others point to the negative impact on the corporation's performance [86,117] Thus, diversity would result in group segregation and accordingly increased conflict between different groups [140].So, The study aimed to investigate this dialectic in the context of emerging markets.
Finally, investigating the impact of TMT diversity on corporations' performance and value in emerging markets is crucial for understanding how diversity can be leveraged as a creator of value.While there are clear potential benefits, it's essential to critically examine this relationship considering the complexities of different markets and organizational contexts.Corporations that effectively harness the power of diverse leadership teams can gain a competitive edge, drive innovation, and navigate the challenges of emerging markets more effectively.Therefore, the current study includes five sections: "Introduction", "Theoretical Framework and Literature Review", "Methods", "Results", and "Conclusions and Recommendations".

The roots of diversity in top management teams
Under the thought of business strategy, there moving from a static view of corporations to a more dynamic one [116].Early studies [63,101] emphasized a focus on maintaining the status quo in corporate strategy, potentially hindering strategic changes by managers [149].In contrast, another school of thought [41,66] advocated for a more proactive approach to strategic change within corporations [70].This perspective highlights the crucial role of the top management team (TMT) in leading these changes [11,35].
Child [41] argues that TMT actions should not solely react to the environment but also explore new strategic opportunities.Mintzberg [103] emphasizes the TMT's role in interpreting information about the external environment, internal strengths and weaknesses, and formulating and implementing strategic changes.This view is shared by others [42,158], who emphasize that successful strategic outcomes depend not only on the strategy itself but also on the capabilities of those implementing it [131].Knight et al. [85] add another layer by suggesting that chosen strategies can influence not just corporation goals but also personal factors, such as employee confidence in their ability to execute the strategy.Upper echelons theory proposed by Hambrick and Mason [69], however, takes a different approach.Researchers like Finkelstein and Hambrick [62] argue that TMT characteristics themselves can be used to predict the success of a wider range of strategic changes.
The upper echelon theory is a concept within the field of organizational behavior and management [162].It suggests that the performance and decisionmaking processes of a corporation are greatly influenced by the backgrounds, experiences, and values of its TMT members.According to this theory, the characteristics and traits of these key decision-makers, such as their education, experience, values, and cognitive abilities, can significantly impact the strategic choices and overall direction of the corporation [46].
The theory emphasizes that the perspectives and decisions of TMT members are shaped by their individual experiences and cognitive frameworks [40].As a result, the composition of a corporation's leadership team can have a profound influence on its strategic direction, decision-making processes, and ultimately its performance and success.Understanding the implications of the upper echelon theory can be valuable for corporations seeking to optimize their leadership structures and decision-making processes [12].
Richard [124] have long emphasized the importance of embracing diversity within corporations as a means of fostering innovation and creativity.The integration of diverse perspectives, experiences, and backgrounds within the top management team can lead to the generation of new ideas and perspectives, ultimately contributing to the development of innovative products and services [79].Furthermore, effective diversity management has been shown to enhance employee morale, job satisfaction, and overall organizational commitment, thereby reducing employee turnover rates and associated recruitment costs [75].Research has also highlighted the positive correlation between diversity management and enhanced problem-solving abilities within teams, leading to more effective decision-making processes and improved business outcomes [122].

The criteria of diversity in top management teams
Since the 1980s, Diversity in top management teams (TMTs) can be assessed using various criteria.demographic diversity differences in gender, race, age, and nationality-on one hand.;experiential diversity-differences in functional backgrounds, industry experience, educational level & its background, and length of service-on the other hand.Despite this diversity in measurements, academic studies have been more interested in both gender, nationality, and education (See Fig. 1).
The evaluation of diversity in top management team members serves as a critical benchmark for assessing an organization's commitment to inclusivity and equity [160].As the business landscape continues to evolve, the significance of a top management team members diverse in fostering innovation and achieving a competitive edge has become increasingly apparent [124].On the other hand; TMT diversity emerges from two distinct attributes of the team members: surface-level -e.g., age, gender, nationality-and deep-level -e.g., knowledge and experience- [20,72].
Top management team members play a crucial role in the strategic and operational leadership of corporations [19].In large corporations, the top management team ensures that corporate strategy is executed efficiently and effectively through their respective organizations [118].In addition, executive management is instrumental in shaping the corporate culture and values.Extensive research has been conducted on executive management team dynamics and performance-related success factors [68].This makes it important to know the characteristics of the top management team, and diversity management is one of the most important characteristics of that team.

Importance top management team diversity
Studying the impact of top management team diversity in emerging market corporations is interesting for several reasons:   [134].(E) Risk Mitigation Operating in emerging markets often involves dealing with a range of risks, including political, economic, and social factors [7].A diverse team may provide a broader perspective on potential risks and help the corporate develop more effective risk mitigation strategies [144].(F) Corporate social responsibility (CSR) Many corporates are recognizing the importance of social responsibility.Demonstrating a commitment to diversity and inclusion is not only ethically responsible but can also positively impact a corporate's reputation, especially in markets where societal expectations for responsible business practices are high [115].(G) Employee Engagement and Productivity A diverse and inclusive workplace fosters a sense of belonging among employees, leading to increased engagement and productivity [98].This is crucial in emerging markets where the motivation and commitment of the top management team can significantly impact a corporate's success [118].(H) Regulatory Compliance In some markets, there are regulations and policies that encourage or require corporates to promote diversity and inclusion [141].
Studying and understanding the impact of diversity helps corporates stay compliant with local laws and regulations.There are many measures for diversity in top management team members [18], but the current study, based on the available data about the study sample, examined three patterns, which are as follows:

Top management team diversity based on gender
Diversity management based on gender refers to the strategies and practices implemented by corporations to effectively manage and promote gender diversity in the workplace [15].It involves creating an inclusive and equitable environment that recognizes and values the contributions and perspectives of individuals of all genders [58].
On other side; Ofori-Sasu et al. [111] found that board gender diversity based on gender and bank disclosure predicts the probability of a banking crisis.This is based on data from 42 African countries over the 2006-2018 period.While Wagdi and Fathi [155] tested diversity top management according to gender in the Egyptian business environment during the period 2018-2021, which indicated a negative impact of female's representation in the board of directors on the degree of total leverage as a measure of the corporation's risks.But on the Indonesia Stock Exchange, based on model testing carried out on 59 nonfinancial corporations in 2015-2019.Pertiwi and Prihandini [119] that gender diversity weakens the effect of EVA on corporation value.
From the above, the study found a dialectical study in the conclusions on the impact of diversity on the performance and value of corporations.So, the study found the following question: what is impact of diversity in top management on corporate's performance and value?
Despite the importance of the results of empirical studies, whether in international or emerging markets, the study formulates the following research question:

Top management team diversity based on education
Diversity management based on education specialty focuses on effectively managing and leveraging the diverse educational backgrounds and expertise of employees in various fields such as business, engineering, healthcare, and others [25].It involves recognizing and valuing the unique knowledge, skills, and perspectives that individuals from different educational disciplines bring to the workplace [148].
According to Mirza et al. [104], TMT members with specific academic backgrounds can significantly digital transformation.So, by embracing diversity based on education, corporations can tap into a wide range of skills, perspectives, and experiences.This can lead to enhanced problem-solving, creativity, and innovation, as well as a more inclusive and supportive work environment.
Despite the significance of previous studies in explaining the impact of diversity-based education in top management teams on corporate performance, particularly in international or emerging markets, the study formulates the following research question:

Diversity management based on nationality
Diversity management based on nationality refers to the strategies and practices implemented by corporations to effectively manage and leverage the diverse national backgrounds of their employees [83].It involves recognizing and valuing the unique perspectives, experiences, and contributions of individuals from different countries [53].
Existing studies on the impact of diversity in top management-based nationalities on corporation's value and performance has mostly shown a favorable effect [48,49,59,71,99,100,112].It's important to note that diversity management based on nationality should be integrated with broader diversity and inclusion initiatives that consider other dimensions such as gender, race, ethnicity, religion, and age.By valuing and leveraging the unique perspectives and talents of individuals from different national backgrounds, corporations can create a more innovative, inclusive, and successful work environment.So, the study formulates the following research question:

Corporation's performance and value
Value cannot be created without a trade-off between risk and return.So, the role of diversity top management can be classified into two dimensions, its risk and return.But this matter can be simpler under the assumption of a positive relationship between risk and return [166].
According to Zhou et al. [168] in China, that intrapersonal functional diversity (IFD) and dominant functional diversity (DFD) have positive effects on their performance.But Daz-Fernández et al. [55] conclude, based on subsidiary corporations of multinational high-technology corporations in eight G20 countries (the United States, China, France, Germany, Canada, Italy, the United Kingdom, and Spain), that diversity on Top Management Team configurations lead to high performance.But in Emerging Markets, under Moscow, Shanghai, Bombay, and Pakistan as stock exchanges over a 13-year period (2008-2020), Bagh et al. [14] found that boardroom diversity has a positive impact on corporations' financial performance,however, the impact is weakened by strategic change for non-financial corporations.
So; the recognition that the diversity on top management plays a significant influence in corporate's performance [8,13,27,30,109,110,151].Despite its status as the gold standard for performance measurement, valuation has long been held in high respect as a management tool [102].Because the relationship between operational planning and value is obscure, complicated, and difficult to establish, top managers have resorted to using several measurements as an operational guide for planning and decision-making [84].
The concept of a corporation's value cannot be separated from the concept of a corporation's performance, as there is a dynamic relationship between the two concepts, and both depend on two variables: risk and return [82].According to Table 1, both variables can be measured at the level of real assets at the level of the corporation's based on the financial reports versus financial assets at the level of common stock on the trading on exchange Traditional financial literature is full of many metrics in this regard, including operational, financing, and total leverage [39,54].Where risk and return were the basis for estimating fair value, regardless of the models like Gordon model.Today the most accepted models are Tobin's Q and economic value added (EVA).
Estimating a corporation's value using economic value added (EVA) offers advantages over free cash flow to the firm (FCFF) or free cash flow to equity (FCFE).EVA, as highlighted in Faiteh and Aasri [60], is a superior metric to traditional indicators like ROE, ROA, and EPS in explaining Market Value Added (MVA).Additionally, EVA can be adapted for unlisted corporations, making it a versatile tool for value creation assessment.On the other hand, while FCFF and FCFE models are conceptually sound for equity valuation [107], EVA's ability to measure wealth creation for shareholders over a specific period [80] and its potential to provide added value to investors when consistently positive [91] make it a more comprehensive and investor-centric approach to corporation valuation.
On other hand, estimating a corporation's value using Tobin's Q offers advantages over traditional models like the dividend discount model (DDM) or Earnings Multiplier.Tobin's Q, as highlighted in various studies [22,31,65], provides a comprehensive assessment by considering market prices, growth prospects, intangible assets, and corporation-specific variables like size, sales, leverage, and return on assets.This approach captures the market's perception of a corporation's value, incorporating both tangible and intangible factors.In contrast, DDM and Earnings Multiplier models rely solely on dividends or earnings, potentially overlooking crucial aspects like growth potential and intangible assets.Tobin's Q, therefore, offers a more holistic and dynamic evaluation of a corporation's worth, making it a valuable tool for investors and analysts seeking a thorough understanding of corporation value.
It's important to note that estimating EVA requires accurate financial data, including profit figures, tax expenses, and information about capital structure.Additionally, determining the appropriate cost of capital involves making assumptions and estimates based on factors such as the corporation's risk profile, industry benchmarks, and market conditions.

Research gap
Despite the growing body of literature on the impact of Top Management Team (TMT) diversity on corporations' performance and value, there exists a notable research gap regarding the nuanced mechanisms through which TMT diversity specifically influences financial performance in emerging markets.On one hand, While previous studies have generally established a positive correlation between TMT diversity and corporation performance [27,32,111,135,155].On other hand, to the negative impact on the corporation's performance [86,117,119]) addition to there is a lack of in-depth analysis on the specific pathways and contextual factors that mediate or moderate this relationship within the unique settings of emerging markets.
Moreover, existing research often focuses on a limited range of diversity dimensions such as gender or nationality, neglecting the broader spectrum of diversity factors that could be relevant in emerging market contexts, such as educational within the TMT.This gap in the literature suggests the need for a more comprehensive examination that explores the interplay between various dimensions of TMT diversity and their impact on different aspects of corporate performance, including financial indicators like profitability, corporate's risk, stock performance, EVA and corporate's value in the specific context of emerging markets.
Addressing this research gap will not only contribute to the academic understanding of TMT diversity but also provide practical insights for corporations operating in emerging markets, enabling them to leverage diversity effectively to enhance their performance and value in these dynamic and evolving business environments.

Study questions
Conducting academic research on TMT diversity in emerging markets is crucial for understanding the potential advantages and challenges associated with diverse leadership teams in these dynamic business environments.Such research can contribute to the development of effective diversity management practices, better decision-making processes, and ultimately, improved corporation's performance and competitiveness in emerging markets.
According to a review of the theoretical framework and empirical studies, the study found a research gap in emerging equity markets, in contrast to international equity markets, in which there is a clear impact of diversity in top management on the corporation's performance.The study investigates, according to the inconsistency of the results of Pertiwi and Prihandini [119] that were conducted in Indonesia, which is considered an emerging equity market, by expanding the scope of the analysis to include seven markets, thus examining the following questions: Q 1 Is there an impact of diversity in top management on corporate's risk in emerging equity markets?
Is there an impact of diversity in top management on common stock's risk in emerging equity markets?
Is there an impact of diversity in top management on corporate's return in emerging equity markets?
Is there an impact of diversity in top management on common stock's return in emerging equity markets?
Is there an impact of diversity in top management on creating economic value added in emerging equity markets?
Q 6 Is there an impact of diversity in top management on corporate's value in emerging equity markets?

Study layout
Creating added economic value for common stockholders refers to the process by which a corporation generates returns and increases its overall worth, thereby benefiting its shareholders.This concept revolves around the idea of maximizing shareholder wealth through various strategies and initiatives that result in the appreciation of the corporation's stock value and the distribution of profits to common stockholders.Essentially, it involves the implementation of effective business practices, financial decisions, and operational strategies that contribute to the growth and profitability of the corporation, ultimately leading to increased dividends, capital gains, and overall wealth accumulation for the common stockholders.This value creation is a key objective for corporations aiming to enhance investor confidence, attract potential investors, and ensure long-term sustainability and success in the competitive marketplace.
Value creation cannot take place without a trade-off of risk and return.This trade-off forms the basis of various financial and strategic choices that corporations make, influencing their investment decisions, capital structure, and overall operational strategies.On one hand, the pursuit of higher returns often necessitates the acceptance of higher levels of risk.On the other hand, the principle of risk management advocates for a cautious approach to risk, particularly concerning the preservation of corporate assets and the protection of shareholder value.
In decision-making processes, corporations must carefully assess the risk-return trade-off to align their strategic objectives with the risk tolerance of their stakeholders, including shareholders, creditors, and other investors.Balancing the pursuit of higher returns with the need for risk mitigation involves a comprehensive evaluation of the corporation's financial position, market dynamics, industry trends, and regulatory environment.This evaluation serves as a basis for formulating effective risk management strategies, setting realistic financial targets, and maintaining a prudent balance between risktaking and risk aversion to ensure sustainable growth and long-term value creation for all stakeholders.The study show that in Fig. 2.
In the end, top management decisions are reflected on two levels: the first is the level of real assets, and here the study is interested in the total leverage degree of the corporations versus the return on equity.The second is the level of financial assets.Here, the study is concerned with the systematic risks of common stocks versus the hold return on those common stocks.In the end, these risks and returns are reflected in the corporation's evaluation and the market value of its common stock according to the benefits generated from top management decisions, which are deducted from the equity risk premium.
Thus, the study expects that value creation will appear according to the diversity of gender, education, and nationality enjoyed by the top management.The study expects and argues that diversity in top management contributes to an effective assessment of the business environment and its changes, which helps top management update the business model to achieve its strategic goals in the long term.It supports sustainable performance.

Study hypotheses
According to the study questions and study layout; there six hypotheses as following: H 10 There isn't a significant impact of diversity in top management on corporations' total leverage in emerging equity markets.

Study variables
According to the theoretical framework and hypotheses of the study, the variables can be mentioned as follows.
Table 2 contains three groups of variables.The dependent variables included two risk variables, two return variables, and two value variables, under one control variable, which is the size of the corporation.As for the independent variables, they were three variables representing diversity in top management based on gender [111,119], education, and nationality [49,59,71,99,112].

Study sample
The study examined the impact of diversity in top management on creating economic value using quantitative analysis in emerging equity markets.Emerging markets in Brazil, Egypt, India, Russia, Saudi Arabia, South Africa, and Turkey have become the most significant new global playgrounds for foreign direct investment (FDI) and foreign portfolio investment (FPI).Emerging markets provide a unique opportunity to extend the literature on top management team members diversity and its reflection on corporations' performance and value.To test hypotheses, the study used cross-sectional unit analyzes for the top ten corporations based on the top ten non-financial corporations listed on each emerging market from the seven stock exchanges.So; The sample consisted of 70 non-financial corporations.Based on annually data, the Reuters financial database was used to compile the data.The study included the last ten years when preparation for the current study began, so it included the period from 2013 to 2022.Table 3 contains a list of the sample's components.
The study applied the cross-sectional analysis methodology to balanced data.To achieve unbiased estimates, increased statistical power, and generalizability.Crosssectional analysis of balanced data provides a snapshot of the population at a specific point in time and allows researchers to draw conclusions about relationships, patterns, and group differences within the data.

Study models
The study used cross-sectional analysis to investigate the impact of gender, education, and nationality diversity in top management on corporations' performance and value in emerging markets.but initially, the study processed the outliers using winsorization at 1% for the continuous variables.
The first function is drafted to explain the proposed framework for the corporations' performance through three types of diversity in top management, in addition to the corporations' size.The study uses four measures to estimate the corporations' performance based on total leverage degree, returns on assets, the common stock's systematic risks, and the common stock's return.So, the study presents an independent model for each measure that is examined through the cross-sectional analysis method. (1)

=
diversity in top management (4) But second function is drafted to explain the proposed framework for the corporations' value through three types of diversity in top management, in addition to the corporations' size.The study uses two measures to estimate the corporations' value based on economic value added and Tobin's Q.So, the study presents an independent model for each measure that is examined through the cross-sectional analysis method.
The study tested six hypotheses, and Eqs. ( 2), ( 3), ( 4), ( 5), ( 7) and ( 8) were drafted to test these hypotheses.Where (j) represent the corporation and (t) represents time.In Eq. ( 2), TLD represents Total leverage degree as a dependent variable, but in Eq. ( 3), B represents the common stock's systematic risks as a dependent variable, but in Eq. ( 4), ROE represents return on equity as a dependent variable, but in Eq. ( 5), HR represents the common stock's hold return as a dependent variable, but in Eq. ( 5), EVA represents economic value added as a dependent variable, and finally, in Eq. ( 8), (6) Corporations value = Diversity in top management TQ represents the Tobin Q measure as a dependent variable.

Stationary of data
The assumption of stationary (constant variance) exists in many time series methods.One of the defining characteristics of a stationary process is that the mean, variance, and autocorrelation values do not vary over time; The study exam the data stationary to ensure that the mean and variance were invariant according to a unit root test, the stationarity of the time series of the basic independent and dependent indicators at level zero was evaluated according to the constant level.This was done through the Augmented Dickey-Fuller (ADF), Philips-Perron (PP), Im, Pesaran and Shin W-stat (IPSW), Levin, Lin and Chut (LLC) tests at a significance level of less than 0.05.In addition to the Tau-statistic, the Z-statistic criteria were at a significance level of less than 0.05.

Examining the impact of top management diversity on total leverage degree:
This section aimed to test the following null hypothesis.H 10 There isn't a significant impact of diversity in top management on corporations' total leverage in emerging equity markets.
The previous hypothesis was tested by relying on crosssectional units within weights based on per-unit error variances; The outputs of the inferential analysis appear in Table 4.
The study was found through the results of inferential analysis, according to Table 4. On the one hand, the estimated value of the coefficient (F) was 12,156.07; the model as all was significant at the (1%) level.On the other hand, the estimated value of the coefficient (t-ratio) for diversity in top management based on gender, fields of education, and nationality was significant at the (1%) level, in addition to the corporation's size, was significant at the (5%) level.This mean has impact of diversity in top management on corporation's risk; according to adjusted r-squared, the explanatory diversity in top management based on gender, fields of education, and foreign nationalities, in addition to the corporation's size, contributes to 68.58% of the variation in corporations' total leverage as a dependent variable.Now, the study rejects the Null hypothesis and accepts the following alternative hypothesis.
H 11 There is a significant impact of diversity in top management on corporations' total leverage in emerging equity markets.Diversity top management teams, encompassing a variety of backgrounds and perspectives, are better equipped to make strategic decisions that mitigate excessive operating leverage.This is because diverse teams tend to approach problems from different angles, leading to more thorough risk assessments and potentially reducing the risk associated with high operating leverage.On the other hand, corporations with diverse top management teams are often more adept at securing favorable financing terms and diversifying their sources of capital.Additionally, diverse teams are better equipped to evaluate the risks associated with different debt structures, potentially lowering the overall risk exposure related to financial leverage [57,106].So,diverse top management teams can influence total leverage by implementing balanced strategies that consider both aspects.For instance, they may focus on optimizing the mix of fixed and variable costs to reduce operating leverage, while simultaneously making informed decisions about debt levels to control financial leverage.This holistic approach to risk management is often more pronounced in corporations with diverse leadership, as various viewpoints contribute to a more nuanced understanding of the trade-offs involved.

Examining the impact of top management diversity on common stock's systematic risks:
This section aimed to test the following null hypothesis.
H 20 There isn't a significant impact of diversity in top management on common stock's systematic risks in emerging equity markets.
The previous hypothesis was tested by relying on crosssectional units within weights based on per-unit error variances; The outputs of the inferential analysis appear in Table 5 The study was found through the results of inferential analysis, according to Table 5.On the one hand, the estimated value of the coefficient (F) was 648.21; the model as all was significant at the (1%) level.On the other hand, the estimated value of the coefficient (t-ratio) for diversity in top management based on gender, fields of education, and nationality was significant at the (1%) level, in addition to the corporation's size, was significant at the (5%) level.This mean has an impact of diversity in top management on common stock's systematic risks; according to adjusted r-squared, the explanatory diversity in top management based on gender, fields of education, and foreign nationalities, in addition to the corporation's size, contributes to 48.7% of the variation in common stock's systematic risks as a dependent variable.Now, the study rejects the null hypothesis and accepts the following alternative hypothesis: H 21 There is a significant impact of diversity in top management on common stock's systematic risks in emerging equity markets.
Diversity in top management has a notable impact on the systematic risks associated with common stocks.This impact stems from diverse teams' ability to offer a broader range of perspectives when making strategic decisions, leading to a more balanced and comprehensive approach to risk management.Consequently, corporations with diverse leadership are often better equipped to navigate market fluctuations and mitigate the systematic risks inherent in common stocks.Diverse top management teams are more likely to engage in thorough and rigorous risk assessments, considering a wider array of potential scenarios and outcomes.This proactive approach to risk management can lead to more effective strategies for diversification and hedging, which in turn can lower a corporation's systematic risk.By leveraging the diverse expertise and perspectives of their leadership teams, corporations can enhance their resilience to market volatility and reduce the impact of external factors on common stock performance.

Examining the impact of top management diversity on return on equity
This section aimed to test the following null hypothesis.
H 30 There isn't a significant impact of diversity in top management on corporations' ROE in emerging equity markets.
The previous hypothesis was tested by relying on crosssectional units within weights based on per-unit error variances; The outputs of the inferential analysis appear in Table 6 The study was found through the results of inferential analysis, according to Table 6.On the one hand, the estimated value of the coefficient (F) was 7715.03;So, the model as all was significant at the (1%) level.On the other hand, the estimated value of the coefficient (t-ratio) for diversity in top management based on fields of education, and nationality, in addition to the corporation's size, was significant at the (1%) level.
But not significant for diversity in top management based on gender.This mean has an impact of diversity in top management on corporations' ROE; according to adjusted r-squared, the explanatory diversity in top management based on fields of education and nationality, in addition to the corporation's size, contributes to 77.78% of the variation in corporations' ROE as a dependent variable.Now, the study rejects the null hypothesis and accepts the following alternative hypothesis: H 31 There is a significant impact of diversity in top management on corporations' ROE in emerging equity markets.
Diversity in top management has an impact on corporations' returns, particularly focusing on return on equity (ROE).Diverse top management teams, comprising individuals from varied backgrounds and demographics, can positively influence a corporation's ROE.This is attributed to diverse teams' ability to bring a broader range of perspectives and innovative ideas to the table, leading to more effective decision-making processes that drive profitability and ultimately enhance ROE under corporate governance [34].

Examining the impact of top management diversity on common stock's hold return
This section aimed to test the following null hypothesis.
H 40 There isn't a significant impact of diversity in top management on common stock's return in emerging equity markets.
The previous hypothesis was tested by relying on crosssectional units within weights based on per-unit error variances; The outputs of the inferential analysis appear in Table 7 The study was found through the results of inferential analysis, according to Table 7.On the one hand, the estimated value of the coefficient (F) was 16,663.94; the model as all was significant at the (1%) level.On the other hand, the estimated value of the coefficient (t-ratio) for diversity in top management based on gender, fields of education, and nationality was significant at the (1%) level, in addition to the corporation's size, was significant at the (5%) level.This mean has an impact of diversity in top management on common stock's return; according to adjusted r-squared, the explanatory diversity in top management based on gender, fields of education, and foreign nationalities, in addition to the corporation's size, contributes to 38.96% of the variation in common stock's return as a dependent variable.Now, the study rejects the null hypothesis and accepts the following alternative hypothesis: H 41 There is a significant impact of diversity in top management on common stock's return in emerging equity markets.
Common stock returns are a crucial metric for investors, reflecting the profitability and growth potential of a corporation.This impact is attributed to the diverse array of ideas and strategies that diverse teams bring to decisionmaking processes.Corporations with diverse leadership tend to outperform those with homogenous leadership in terms of stock returns, as diverse teams are more adept at identifying market opportunities and making informed, innovative decisions that drive shareholder value.

Examining the impact of top management diversity on economic value added
This section aimed to test the following null hypothesis.
H 50 There isn't a significant impact of diversity in top management on creating economic value added to common stockholders in emerging equity markets The previous hypothesis was tested by relying on crosssectional units within weights based on per-unit error variances; The outputs of the inferential analysis appear in Table 8 The study was found through the results of inferential analysis, according to Table 8.On the one hand, the estimated value of the coefficient (F) was 310.3; the model as all was significant at the (1%) level.On the other hand, the estimated value of the coefficient (t-ratio) for diversity in top management based on gender and fields of education was significant at the (1%) level, but diversity in top management based on nationality was significant at the (5%), in addition to the corporation's size, was significant at the (5%) level.This mean has an impact of diversity in top management on economic value added; according to adjusted r-squared, the explanatory diversity in top management based on gender, fields of education, and foreign nationalities, in addition to the corporation's size, contributes to 639% of the variation in economic value added as a dependent variable.Now, the study rejects the null hypothesis and accepts the following alternative hypothesis: H 51 There is a significant impact of diversity in top management on creating economic value added to common stockholders in emerging equity markets Diverse top management teams, comprising individuals with diverse backgrounds and perspectives, can positively influence a corporation's EVA.This impact is attributed to the varied viewpoints and innovative ideas that diverse teams bring to strategic decision-making.Additionally, the impact of diversity on EVA is intertwined with corporate governance and risk management practices.Diverse top management teams are often associated with improved governance structures, increased transparency, and effective risk mitigation strategies.These factors contribute to a positive perception among stakeholders, which can lead to higher EVA.Moreover, diverse teams are more adept at understanding and responding to diverse customer needs and market dynamics, which can result in enhanced value creation and, subsequently, higher EVA [18].

Examining the impact of top management diversity on a corporation's value
This section aimed to test the following null hypothesis.
H 60 There isn't a significant impact of diversity in top management on corporations' value in emerging equity markets.
The previous hypothesis was tested by relying on crosssectional units within weights based on per-unit error variances; The outputs of the inferential analysis appear in Table 9 The study was found through the results of inferential analysis, according to Table 9.On the one hand, the estimated value of the coefficient (F) was 432.5676; the model as all was significant at the (1%) level.On the other hand, the estimated value of the coefficient (t-ratio) for diversity in top management based on fields of education and nationality was significant at the (1%) level, in addition to the corporation's size, was significant at the (5%) level, but diversity in top management based on gender not significant.This mean has an impact of diversity in top management on economic value added; according to adjusted r-squared, the explanatory diversity in top management based on fields of education, and foreign nationalities, in addition to the corporation's size, contributes to 51.2% of the variation in economic value added as a dependent variable.Now, the study rejects the null hypothesis and accepts the following alternative hypothesis: H 61 There is a significant impact of diversity in top management on corporations' value in emerging equity markets.
Diversity in top management has an impact on a corporation's overall value.The value of a corporations is determined by various factors, including its financial performance, market position, and reputation.This impact stems from the diverse array of ideas and insights that diverse teams bring to strategic decision-making processes.Diversity in top management has an impact on a corporation's overall value.Through diverse perspectives, innovative ideas, and improved governance practices, corporations with diverse leadership are better positioned to enhance their market valuations and attract investment.Additionally, the ability to attract top talent and respond effectively to market dynamics further contributes to increased corporation value.

Discussion
The findings presented in the study regarding the impact of top management team (TMT) diversity on corporations' performance and value in emerging markets raise several points for critical academic discussion.
Firstly, the assertion that globalization has significantly altered the composition of TMTs globally is consistent with broader trends observed in the business landscape.As corporations expand operations across borders and engage with diverse markets, the need for diverse perspectives within leadership teams becomes increasingly apparent.However, it is essential to delve deeper into the specific mechanisms through which globalization influences TMT composition and the implications of these changes for organizational outcomes.
Second, the use of quantitative analysis for 70 nonfinancial corporations across multiple emerging markets provides valuable insights into the relationship between TMT diversity and corporate outcomes.However, the cross-sectional nature of the analysis limits the ability to draw causal conclusions.Future research could benefit from longitudinal studies that track changes in TMT composition and organizational performance over time, allowing for a more robust assessment of causality.
Third, the finding that diversity based on education and nationality significantly impacts corporations' performance and value aligns with existing literature on the benefits of cognitive diversity within TMTs.By bringing together individuals with different educational backgrounds and cultural perspectives, organizations can leverage a broader range of insights and approaches to problem-solving.However, it is essential to explore the specific mechanisms through which this diversity translates into improved performance, whether through enhanced decision-making processes, increased innovation, or other channels.
Fourth, the study's interpretation of its findings in light of the upper-echelon theory offers valuable insights into the underlying mechanisms driving the relationship between TMT diversity and organizational outcomes.By emphasizing the role of diversity management in importing foreign corporate governance practices, fostering innovation, and modifying risk attitudes, the study highlights the broader implications of TMT diversity for organizational performance.
The study provides some intriguing insights into the relationship between top management team (TMT) diversity and corporation performance and value in emerging markets.The use of quantitative analysis to examine data across multiple emerging economies strengthens the generalizability of the findings.However, there are several limitations that must be considered.
First, the study relies solely on quantitative metrics of diversity-gender, education, and nationality.While these are important factors, diversity is a complex concept that encompasses many other dimensions like age [89,93], functional background [26,30], cognitive styles [2,97], and personality traits [5,123].Examining only a narrow set of demographic variables provides an incomplete picture of how TMT diversity truly influences corporation outcomes.
Second, the concepts of corporation performance and value are multifaceted, yet the study employs only limited measures like profitability ratios and stock performance.Additional balanced scorecard indicators [73,165] could provide deeper insights into how different aspects of corporation outcomes are impacted by TMT diversity.
Third, the non-significant finding regarding gender diversity merits further investigation.Existing research has shown mixed results in this area, but many studies point to a positive link between female representation in leadership and corporation financial performance (This is consistent with [155], But this contradicts with [161]).The non-significant effect in this study may stem from methodological issues rather than a true lack of impact.
Fourth, top management team (TMT) diversity works to create many benefits for shareholders, employees, and society as a whole, which supports entrepreneurship [156].TMT diversity works to exploit opportunities in the business environment and achieve sustainable growth for corporations.
Overall, the study makes a useful contribution to the empirical research on TMT diversity in emerging markets.However, the limitations highlight the need for further research using more sophisticated conceptualizations and measurements of diversity, longitudinal designs, and nuanced corporation performance variables before definitive conclusions can be drawn.Critical analysis and replication are essential to developing robust, generalized evidence-based management theory.
The study can explain why gender doesn't have a significant impact on some key performance indicators (KPIs) by switching the main theory from the sexual selection theory to the prospect theory [16,159,167].Many traditional studies show that gender differences exist in investment behavior [81,143], which is usually reflected in risk attitudes.While males are often perceived as more risk-taking in the stock market, females tend to be more risk-averse.However, recent research challenges these stereotypes, indicating weak causal relations between biological gender traits and behavioral biases [113].Maxfield et al. [96] found gender neutrality in risk propensity and decision-making in specific managerial contexts other than portfolio allocation.But according to Iqbal and Baek [78], male executives are more risk-averse by engaging in higher diversification-related stock sales than female executives.It is also found that stock sales by male executives approximate the optimal hedge ratio.This is consistent with Ingersoll et al. 's [77] finding that females in top corporate positions embrace risk, leading to more financial risk in companies with female CEOs and executives, challenging the stereotype of females being more risk-averse in stock markets.

Conclusions
In today's increasingly globalized and diverse business environment, organizations are facing new challenges and opportunities in terms of management practices [33].One area of particular interest is the diversity of top management teams and its potential impact on firm performance [56].Diverse top management teams are characterized by individuals from different backgrounds.These diverse teams bring different perspectives, experiences, and expertise to the decision-making process, which can lead to more innovative and effective strategies [33].Studying diversity management in emerging markets corporates is essential for promoting innovation, understanding diverse markets, enhancing global competitiveness, attracting top talent, mitigating risks, fulfilling CSR goals, and fostering a positive work environment that drives employee engagement and productivity.
Top management team (TMT) members in publicly listed corporations all over the globe is being significantly altered as a direct result of the effects of globalization.Cross-border capital flows have had a tremendous impact on the ownership structure of corporations, and as a result, the make-up of top management, who are tasked with representing the interests of shareholders, has also been dramatically altered [71].As is the case in international markets, there are many corporates in emerging markets that have sought to strengthen their top management team (TMT) members.
The current study contributes to filling the knowledge gap about the impact of top management team (TMT) members diversity on the performance and value of corporation emerging markets.So; The study investigated the impact of Top management diversity on corporations' performance and value.Top management Diversity, which included the board of directors in addition to the executive directors, according to the corporations' annual report.
The study found, based on a sample of 70 non-financial corporations' during the period from 2013 to 2022, from Brazil, Egypt, India, Russia, Saudi Arabia, South Africa, and Turkey, that diversity based on education and nationality has a significant impact on both corporations' performance and value, but diversity based on gender does not have a significant impact on a corporation's value or return on equity (ROE) in addition to its common stock's return.So, top management team members diversity contributes to increasing the scope of opportunities for corporations in addition to reducing their risks, which supports their value by creating added value for stockholders.
The results of the current study are consistent with both Oxelheim and Randøy [112], Miletkov et al. [100], Daniel et al. [49], and Estélyi and Nisar [59].These studies have been conducted to find the impact that diversity in top management-based nationalities, or, in other words, nationality, has on the value and performance of corporations and have typically shown that this effect is beneficial.
The current study agrees with Oxelheim and Randøy [112] for their explanation of diversity in top management-based nationalities and its impact on value and performance of corporations.This superior performance is a reflection of the fact that these corporations have successfully broken away from a partially segmented domestic capital market by "importing" a foreign corporate governance system, this "import" signifies that the corporation is prepared to subject itself to enhanced corporate governance, which in turn improves the corporation's image in the financial market.
The previous result contradicts Kyriazis and Anastassis [90], according to the Athens Stock Exchange.Tests of relative information content indicate that net and operating income appear to be more pertinent to a common stock's value than EVA.In addition, incremental information experiments indicate that the unique EVA components contribute minimally to the information content of accounting profit.So, EVA does not appear to have a stronger correlation with corporations' market value than the other variables, The study interpreted this conclusion under the contribution of diversity management to the richness of ideas, strengthening innovation and creativity, and modifying top management's risk attitudes.Addition to In addition to enhancing the work environment in corporations [157].So, the recognition that the diversity on top management plays a significant influence in corporate's performance [8,13,30,109,110,151].
This aligns effectively with the assertion made in upper echelon theory that corporations mirror the qualities of their top management team members [69].According to [24,36,74,86,136], top management team (TMT) members with diverse backgrounds and areas of expertise assist the corporations in addressing the business challenges that arise from uncertainty.
On other hand; The study believes that the optimal mass of diversity based on demographic diversity differences in gender, race, age, and nationality-on one hand.;experiential diversity-differences in functional backgrounds, industry experience, educational level & its background, and length of service-on the other hand.Which means the weight of members with diverse backgrounds, determines whether the impact of diversity is positive or negative.If it is less than this mass, the benefits of diversity are limited, but if the mass is greater than it, the harms of diversity are greater than the benefits.However, with the optimal mass for diversification, the benefits are maximized.Figure 3 show the impact of diversity in TMT on corporate performance.
Previous studies have shown that TMT members diversity can lead to increased creativity, innovation, problem-solving ability, talent attraction & retention, and employee engagement & productivity [24,29,37,98,108,118,126,129,134,139], but it can also lead to conflicts and communication difficulties [9,21,51,61,150,163]. Understanding the optimal mass of diversification is important for organizations to effectively manage diversity and maximize the benefits of diversification.So, corporations must trade-off between the benefits of TMT members diversity and its costs according to the mass of TMT members diversity.

Recommendations to enhance diversity in top management:
Here's a plan outlining steps to enhance diversity in top management: nize and celebrate the contributions of diverse leaders within the organization.Highlight their achievements, share success stories, and promote their visibility as role models for aspiring professionals.Use these success stories to inspire and motivate employees to aspire to leadership roles regardless of their background.
By implementing this comprehensive plan, organizations can create a more inclusive and diverse top management team, fostering a culture of innovation, collaboration, and excellence that reflects the richness of diverse perspectives and experiences.

Recommendations to future studies
Certainly, here are some potential future study areas on diversity in top management: A. Estimating critical mass under TMT members diversity it based on demographic diversity differences in gender, race, age, and nationality-on one hand.;experiential diversity-differences in functional backgrounds, industry experience, educational level & its background, and length of service-on the other hand.Which means the weight of members with diverse backgrounds, determines whether the impact of diversity is positive or negative.If it is less than this mass, the benefits of diversity are limited, but if the mass is greater than it, the harms of diversity are greater than the benefits.However, with the optimal mass for diversification, the benefits are maximized.These future studies can provide valuable insights into the complexities of diversity in top management and contribute to the development of more effective strategies and policies for promoting inclusive leadership and diverse representation within organizations.

Fig. 1
Fig. 1 Dimensions of Diversity in TMT opment of diverse talent, and promoting a sense of belonging among all employees.G. Diversity and Talent Management Explore the connection between diversity in top management and talent management strategies.Assess how organizations attract, retain, and develop diverse talent, and investigate the impact of these practices on the overall organizational culture, employee engagement, and productivity.H. Ethical Implications of Diversity Initiatives Examine the ethical considerations associated with diversity initiatives in top management.Assess the ethical dilemmas that may arise from implementing diversity programs, and investigate the potential unintended consequences or challenges that organizations face when navigating issues related to representation, inclusivity, and equity.I. Influence of External Stakeholders Investigate the influence of external stakeholders, such as customers, investors, and regulatory bodies, on the implementation and success of diversity initiatives in top management.Analyze how external pressures and expectations shape organizations' diversity strategies and practices.J. Technological Interventions for Diversity Explore the role of technology in promoting diversity in top management.Investigate the use of AI-driven tools, data analytics, and digital platforms to support diversity initiatives, enhance recruitment practices, and mitigate biases in the selection process for executive positions.

Table 1
Return, Risk, and value of corporation Metrics

Table 2
Study variables T : The earnings for corporation (j) in year (T) OE J,T : The total owner's equity for corporation (j) in year (T) j,t = [(C j,t + P j,t -P j,t−1 ) ÷ P j,t−1 ] Where: C j,t : Cash dividends to holders of common stock for corporation (j) in year (T) P j,t: The price of the corporation's common stock (j) at the end of the year (T) P j,t−1: The price of the corporation's common stock (j) at the beginning of the year (T) j,t = NOPAT j,t -(I j,t × WACC j,t ) Where: NOPAT J,T : Net operating profit after taxes for corporation (j) in year (T) I J,T : Invested capital for corporation (j) in year (T) WACC j,t : Weighted average cost of capital for corporation (j,t = (MVE j,t /BVE j,t ) + (MVD j,t /BVD j,t ) Where: MVE j,t : Market value of owner's equity for corporation (j) in year (t) BVE j,t : Book value of owner's equity for corporation (j) in year (t) MVD j,t : Market value of debt for corporation (j) in year (t) BVD j,t : Book value of for corporation (j) in year (t)9Diversity in top management based on education E j,t E j,t = NEITM j,t ÷ MITM j,t Where: NEITM j,t : The number of lowest educational specialization in top management team for corporation (j) in year (t) MITM j,t : Total members in top management team for corporation (j) in year (t)H 50 There isn't a significant impact of diversity in top management on creating economic value added to common stockholders in emerging equity markets H 60 There isn't a significant impact of diversity in top management on corporations' value in emerging equity markets.

Table 3
list of the sample's components

Model 6: WLS, using 700 observations Included 70 cross-sectional units Dependent variable: TQ Weights based on per-unit error variances
Create a Supportive and Inclusive Organizational Culture Foster an inclusive organizational culture that values diversity and encourages open communication, collaboration, and respect among employees at all levels.Establish employee resource groups, mentorship programs, and networking opportunities to support the professional growth and development of diverse talent within the organization.G. Promote Transparency and Accountability Establish transparent reporting mechanisms to track the progress of diversity initiatives and communicate the results to all stakeholders.Hold leaders and managers accountable for promoting diversity and inclusion within their respective teams, incorporating diversity-related goals into their performance assessments and evaluations.H. Regularly Evaluate and Adjust Strategies Continuously monitor and evaluate the effectiveness of diversity enhancement strategies.Collect feedback from employees, conduct regular surveys, and analyze relevant data to identify areas for improvement and make necessary adjustments to the diversity plan.I. Engage with External Diversity Experts and Consultants Seek guidance and support from external diversity experts and consultants who can provide valuable insights and best practices for enhancing diversity in top management.Leverage their expertise to develop customized strategies that align with the organization's values and goals.J. Celebrate Diversity and Promote Visibility Recog- B. Global Comparative Analysis Conduct a cross-cultural examination of diversity in top management across different countries and regions.Compare the approaches, challenges, and successes in promoting diversity at the highest levels of management in various cultural contexts.C. Long-term Organizational Performance Analyze the long-term impact of diverse leadership teams on the financial and non-financial performance of organizations.This research could focus on understanding how diversity initiatives in top management affect innovation, decision-making, and overall organizational sustainability over extended periods.D. Diversity and Corporate Governance Investigate the relationship between diversity in top management and corporate governance practices.Explore how diverse leadership influences corporate decision-making processes, risk management strategies, and the establishment of ethical frameworks within organizations.E. Barriers to Advancement Examine the barriers that prevent individuals from diverse backgrounds from ascending to top management positions.Identify systemic challenges, biases, and cultural factors that hinder the progression of underrepresented groups into executive roles, and propose strategies to mitigate these obstacles.F. Role of Inclusive Leadership Investigate the role of inclusive leadership in fostering diversity within top management.Study the specific behaviors and practices of leaders that contribute to creating an inclusive organizational culture, facilitating the devel- Diversity in top management based on gender for corporation (j) in year (t) HR j,t The common stock's hold return for corporation (j) in year (t) IPSW Im, Pesaran and Shin W-stat test KPIs Key performance indicators LLC Levin, Lin and Chut test N Common stock's systematic risks for corporation (j) in year (t) j,t Diversity in top management based on nationality for corporation (j) in year (t) NOPAT Net operating profit after