The role of board age diversity in the performance of publicly listed Fintech entities

The present study addresses the important demographic of director age in relation to the performance of the constituent firms of Fintech-focused Exchange Traded Funds (ETFs). While private Fintech boards accommodate generally young officers, regulatory and market forces contribute to notable shifts in the board age composition of seasoned, publicly listed Fintech entities. Within the fast-moving and evolving context of Fintech, we assess how board age composition impacts on such firms’ return-on-assets, sales-on-assets, cash flow proficiencies, and market-to-book value. Our study findings suggest age diversity exhibits a significant inverse relation with the first three of these performance measures. Fintech entities with lower board age dispersion achieve stronger performance in the key metrics. Such a finding holds in cross-sectional terms (i.e. without material change in the average age of board members across the study period). Within our study context, we also assess the age gap between non-executive directors (NEDs) and executive officers (EDs). For most sample firms, average NED age markedly exceeds ED age. Through a battery of tests, we demonstrate more seasoned (i.e. less young) EDs support Fintech firm performance. The presence of more experienced EDs serves in narrowing the age gap with older and more seasoned NEDs.