Digital Strategy and SME Performance: The Role of Social Media and Young-Female Board Members

Digital strategy is a key element for SME competitiveness, and social media is emerging as a crucial component for optimizing internal processes and improving financial performance. However, there remains an open discussion about how to achieve these goals and the role of diversity in corporate governance in influencing SMEs' financial performance. This study explores the impact of digital strategy, with a focus on social media, in improving the financial performance of SMEs, while also analysing how diversity on boards, particularly the presence of young-female members, can enhance this relationship. Using innovative data from 250 SMEs over a 10-year period and applying the generalized method of moments (GMM), the results show that social media contributes positively to SMEs' financial performance. In addition, the complementary role of young-female boards in maximizing the benefits of social media is noted. These findings offer significant contributions to both academic research and management practice, underscoring the importance of generational and gender diversity in governance in enhancing the effectiveness of digital strategy in SMEs.