Stock Price May Drop When a Woman Joins the Board

Hard to believe, but recent research supports the idea that a company's stock price will drop when a woman joins the board of directors. According to a new HBR.org series on workplace diversity:

"Studies looking specifically at the consequences of appointing women to corporate directorships show that stock performance tends to be unchanged or slightly worse after boards increase their gender diversity," writes Andrew O'Connell.

Why? Bias held by small-share investors, who are for some reason made nervous by the growing diversity on the board and sell, driving the price down. Investors who hold large blocks of stock actually buy more shares, but not enough to counter the smalls.