TY - JOUR

T1 - Board gender diversity and carbon emissions

T2 - European evidence on curvilinear relationships and critical mass

AU - Nuber, Claudio

AU - Velte, Patrick

PY - 2021/5

Y1 - 2021/5

N2 - The role of European businesses in addressing environmental issues and climate change has taken center stage with the European Green Deal. With increasing attention to the effect of board gender diversity (BGD) on firms' environmental performance, the question arises whether BGD has any influence on carbon emissions. Based on legitimacy and critical mass theory, this study empirically investigates the impact of BGD on firms' carbon performance (CP), based on total carbon emissions intensity. The paper relies on two-stage least squares (2SLS) regressions with instrumental variable (IV) and a two-step generalized method of moments (GMM) system approach to analyze a cross-country sample of 3123 observations from non-financial firms in the European STOXX600 index over the 2009–2018 period. Our findings add to the growing empirical evidence twofold: (1) there is a robust linear and positive relationship between BGD and CP, whereas some indication of a U-shaped relationship is found; and (2) we find that a critical mass of at least two women directors needs to be reached to increase CP. Our research results contribute to the current discussion on sustainable corporate governance, especially in the European capital market, and have implications for researchers, business practice, and regulatory issues alike.

AB - The role of European businesses in addressing environmental issues and climate change has taken center stage with the European Green Deal. With increasing attention to the effect of board gender diversity (BGD) on firms' environmental performance, the question arises whether BGD has any influence on carbon emissions. Based on legitimacy and critical mass theory, this study empirically investigates the impact of BGD on firms' carbon performance (CP), based on total carbon emissions intensity. The paper relies on two-stage least squares (2SLS) regressions with instrumental variable (IV) and a two-step generalized method of moments (GMM) system approach to analyze a cross-country sample of 3123 observations from non-financial firms in the European STOXX600 index over the 2009–2018 period. Our findings add to the growing empirical evidence twofold: (1) there is a robust linear and positive relationship between BGD and CP, whereas some indication of a U-shaped relationship is found; and (2) we find that a critical mass of at least two women directors needs to be reached to increase CP. Our research results contribute to the current discussion on sustainable corporate governance, especially in the European capital market, and have implications for researchers, business practice, and regulatory issues alike.

KW - Management studies

KW - corporate governance

KW - gender diversity

KW - Sustainability Science

KW - carbon emissions

KW - Carbon performance

KW - climate change

KW - critical mass

UR - http://www.scopus.com/inward/record.url?scp=85099370120&partnerID=8YFLogxK

UR - https://www.mendeley.com/catalogue/5f458ec2-c2a4-3b85-9c25-be8c8311653b/

U2 - 10.1002/bse.2727

DO - 10.1002/bse.2727

M3 - Journal articles

AN - SCOPUS:85099370120

VL - 30

SP - 1958

EP - 1992

JO - Business Strategy and the Environment

JF - Business Strategy and the Environment

SN - 0964-4733

IS - 4

ER -