Board gender diversity and environmental performance: An industries perspective

Abstract

This study investigates whether gender diversity on the board of directors in the United States is associated with firms' environmental performance. Under the theoretical framework of resource dependence theory, we argue that gender diversity brings a greater variety of skills to the board. Diversity allows for a healthy mix of knowledge and experience to improve the decision‐making process of the board. Using propensity score matching and controlling for endogeneity, this study uses a more rigorous statistical model than previous work. It also uses content analysis of directors' biographies to provide evidence of the role that gender diversity plays. We find gender diversity is positively associated with firms' environmental performance scores primarily in the more environmentally impacting industries. Therefore, our research provides valuable direction for those firms working to improve both their boards' gender diversity and their environmental performance. Our findings also offer insight into the mixed results of previous studies.

Board gender diversity and corporate environmental performance: The moderating role of family and dual‐class majority ownership structures

“…Their results were reinforced by Li et al (), whose findings confirm a positive effect of board gender diversity on firms' environmental policies, moderated by firms' character in terms of pollution creation likelihood, showing that in industries that are more likely to create environmental pollution, the positive effect of gender diversity may be more salient (Li et al, ). The industry effect has also been studied by Lu and Herremans (), whose results are in line with the previous work, finding that board gender diversity in more environmentally impacting industries is associated with higher scores in environmental performance; such effect was, instead, not significant in less environmentally impacting industries, such as retail and services. In a longitudinal analysis on U.S. firms, Kassinis et al () also showed that female representation impacts corporate environmental consciousness positively.…”

“…Following the studies on CSR in general, some researchers found that women have a more protective attitude towards the environment in particular (Wehrmeyer & McNeil, ) and are more likely than males to be ecologically conscious (Park, Choi, & Kim, ). Related research shows that boards with a higher proportion of women directors had higher environmental performance (Kassinis et al, ; Li et al, ; Lu & Herremans, ; Post et al, ; Walls et al, ) and higher levels and quality of environmental reporting (Rao et al, ; Liao et al, ; Ben‐Amar et al, ; Lagasio & Cucari, ; Bravo and Reguera‐Alvarado, 2019). These relationships are found in non‐U.S.…”

“…As women directors have been viewed as paying more attention to the welfare of the natural environment and other external stakeholders (Krüger, ; Li et al, ; Lu & Herremans, ; Post et al, ; Walls et al, ), family owners would expect women directors to be sympathetic to family's interests in the case of an environmental CSR agenda and thus, if appointed, to use their influence on the board to bring this agenda about. Recently, Cruz, Justo, Larraza‐Kintana, and Garcés‐Galdeano () found that women nonfamily outsiders and women family insiders do enhance corporate social performance in family firms, due to their relative power and legitimacy vis‐à‐vis other directors.…”

“…An extensive and body of research on the effects of board gender diversity on CSR has already developed (Bear et al, 2010;Boulouta, 2013;Byron & Post, 2016;Ibrahim & Angelidis, 1994;Krüger, 2009;Rao & Tilt, 2016;Setò-Pamies, 2015;Yasser et al, 2017;Zhang et al, 2013). However, in this body of research, environmental CSR is only a single dimension of the complex CSR engagement construct; and so, it is difficult to distinguish between social and environmental performance (Lu & Herremans, 2019), isolating the unique impact on environmental performance.…”

“…Within this stream, several recent studies have focused on internal corporate governance mechanisms as drivers of corporate environmental performance and proactivity (Cordeiro & Sarkis, ; Calza, Profumo, & Tutore, ; Earnhart & Lizal, ; Kock, Santal, & Diestre, ; Lu & Herremans, ; Ortiz‐de‐Mandojana & Aragon‐Correa, ; Ortiz‐de‐Mandojana, Aragon‐Correa, Delgado‐Ceballos, & Ferron‐Vilchez, ; Walls et al, ).…”