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PurposeIn this study, the authors argue that because of female traits, the proportion of female directors in the board helps the governing body make more cautious decisions, thus improving the investment efficiency of the firm. Therefore, this research aims to propose the mediating role of caution in reexamining the relationship between the proportion of female directors and the efficiency of the investment of a firm.Design/methodology/approachThis study uses data on 100 nonfinancial listed firms in Malaysia between 2015 and 2018. The authors use several multivariate regression analyses to test the mediating effect.FindingsThe result shows that female directors significantly affect investment efficiency. Moreover, the findings in this research confirm the mediating role of caution in the relationship between the proportion of female directors and the efficiency of firm investment.Practical implicationsThis study proves that increasing the proportion of females in the board of directors is an effective governance method to improve the investment efficiency of listed firms in Malaysia.Originality/valueIn general, this study contributes to the literature by extending the current understanding of risk propensity differences between male and female directors and introducing the concept of caution.