Environmental, social and governance (ESG) disclosure and firm performance: Moderating role of board gender diversity and sustainability committee

Ahmad Yuosef Alodat; Yunhong Hao

doi:10.1002/sd.3126

journal article Aug 02, 2024

Environmental, social and governance (ESG) disclosure and firm performance: Moderating role of board gender diversity and sustainability committee

Ahmad Yuosef Alodat

Yunhong Hao

Sustainable Development Vol. 33 No. 1 pp. 636-651 · Wiley

View at Publisher Save 10.1002/sd.3126

Abstract

AbstractThis paper aims to investigate the moderating effect of board gender diversity (BGD) and sustainability committee in the relationship between environmental, social and governance (ESG) disclosure and the performance of the firm in European countries. This study encompasses an analysis of data obtained from non‐financial firms listed in European markets spanning the years 2013–2022. The findings indicate that ESG disclosure has a pronounced and statistically significant influence on the performance of the firms. Furthermore, BGD plays a positive moderating role in enhancing the relationship between ESG disclosure and ROA. In addition, the sustainability committee showed a moderate positive relationship. The findings have substantial managerial implications for professionals spanning different sectors, such as practitioners, policymakers, senior executives, and corporate leaders. Firms are advised to strategically consider board restructuring to enhance effectiveness in overseeing and advancing ESG practices. Prioritizing ESG efforts is recommended as it enhances overall performance, with investing in gender diversity on boards further strengthening this relationship. Establishing a dedicated sustainability committee can also positively impact firm outcomes, highlighting the importance of proactive ESG integration within corporate strategies. Analyzing the role of BGD as a moderating factor represents a valuable addition to the current body of research. It enhances our comprehension of how ESG disclosure indirectly influences firm performance.

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References

Details

Published: Aug 02, 2024
Vol/Issue: 33(1)
Pages: 636-651
License: View

Authors

A

Ahmad Yuosef Alodat

School of Business Administration Zhejiang Gongshang University Hangzhou China

Y

Yunhong Hao

School of Business Administration Zhejiang Gongshang University Hangzhou China

Funding

National Office for Philosophy and Social Sciences Award: 22CGL063

Cite This Article

Ahmad Yuosef Alodat, Yunhong Hao (2024). Environmental, social and governance (ESG) disclosure and firm performance: Moderating role of board gender diversity and sustainability committee. Sustainable Development, 33(1), 636-651. https://doi.org/10.1002/sd.3126

Environmental, social and governance (ESG) disclosure and firm performance: Moderating role of board gender diversity and sustainability committee

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