Increasing interest in women’s representation in corporate leadership has prompted extensive research on female leadership’s impact on firm innovation. However, both the theoretical foundation and the empirical findings of this research stream remain fragmented and inconclusive. To reconcile this fragmentation and inconclusiveness, we conduct a theory-driven meta-analysis of 424 effect sizes from 185 studies investigating the effect of female leadership on innovation depending on the differentiation between individual leaders (CEO) and leadership teams (TMT or boards), and the innovation type (input or output). Herein, providing a holistic framework through the perspective of upper echelons and social identity theory we shade light on the questions of whether, why, and when female leadership enhances innovation. Crucially, our results suggest that gender-diverse leadership teams increase innovation, while female individual leaders show no effect. Further, we reveal that this positive effect is stronger for innovation output than for innovation input suggesting that more efficient innovation processes instead of a general strategic orientation toward innovation is the decisive driver behind this positive effect. Taken together, our theorizing and findings imply that group processes in gender-diverse leadership teams rather than gender differences of individual leaders are the reason behind the effect of female leadership on innovation.
