Corporate profitability and effective tax rate: the moderating role of board gender diversity

Abstract

Purpose This paper aims to investigate the relationship between corporate profitability (CP) and effective tax rate (ETR) and to examine whether this relationship is moderated by board gender diversity (BGD). Design/methodology/approach The multivariate regression analysis was conducted to test the relationship between related variables. This study used sample of 70 Jordanian firms listed on the Amman Stock Exchanges for the period 2013 – 2020. Findings The results show a negative relationship between CP and ETR. Furthermore, the moderating variable BGD changes the strength and the sign, from a negative to a positive influence, of the relationship between CP and ETR. Originality/value To the best of the authors' knowledge, this study is among the first that provides empirical evidence regarding the relationship between CP and ETR in the light of BGD. Further, this study provides new and important insights that are not evident from the previous literature.