Product market competition, board gender diversity and corporate sustainability performance: international evidence

Purpose: This study aims to investigate whether board gender diversity is associated with corporate sustainability performance and whether industry-level product market competition moderates the effect of board gender diversity on corporate sustainability performance. Design/methodology/approach: Th...

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التفاصيل البيبلوغرافية
الحاوية / القاعدة:Journal of Financial Reporting and Accounting
المؤلف الرئيسي: 2-s2.0-85113756977
التنسيق: مقال
اللغة:English
منشور في: Emerald Group Holdings Ltd. 2022
الوصول للمادة أونلاين:https://www.scopus.com/inward/record.uri?eid=2-s2.0-85113756977&doi=10.1108%2fJFRA-01-2021-0020&partnerID=40&md5=5678c3d3d2c7accb29f9dc0a755c7c52
id Kamarudin K.A.; Ariff A.M.; Wan Ismail W.A.
spelling Kamarudin K.A.; Ariff A.M.; Wan Ismail W.A.
2-s2.0-85113756977
Product market competition, board gender diversity and corporate sustainability performance: international evidence
2022
Journal of Financial Reporting and Accounting
20
2
10.1108/JFRA-01-2021-0020
https://www.scopus.com/inward/record.uri?eid=2-s2.0-85113756977&doi=10.1108%2fJFRA-01-2021-0020&partnerID=40&md5=5678c3d3d2c7accb29f9dc0a755c7c52
Purpose: This study aims to investigate whether board gender diversity is associated with corporate sustainability performance and whether industry-level product market competition moderates the effect of board gender diversity on corporate sustainability performance. Design/methodology/approach: This study uses international data extracted from global ESG data set from Thomson Reuters (Refinitiv) database. Using data of 23,137 firm-year observations from 37 countries, the authors perform regression analyses to examine the hypotheses. Findings: The findings show that firms with high board gender diversity exhibit high corporate sustainability performance. The authors also find firms in highly competitive industries to have low corporate sustainability performance. In highly competitive industries, the positive relationship between board gender diversity and corporate sustainability performance is weakened. The results are robust to various specification tests such as alternative measures for corporate sustainability performance, board gender diversity, product market competition and also the use of propensity score matching to address endogeneity issue. Overall, the results support the prediction that board diversity and product market competition play a substitutive role in influencing corporate sustainability performance. Research limitations/implications: This study offers empirical evidence that the appointment of female directors is a useful way to improve a firm’s corporate sustainability performance, hence, providing significant benefits in terms of stakeholders’ values and corporate reputation. Practical implications: This study provides useful insights to investors and policymakers that intense industry competition might mitigate the role of board governance, particularly board gender diversity, in enhancing corporate sustainability performance. Originality/value: Using an international data set, where the observations operate in various market and institutional differences, this study is able to extricate the positive impact of board gender diversity and product market competition on corporate sustainability performance. This study corroborates evidence that sustainability strategy and initiatives are reflections of integrated factors, including corporate governance as internal driver and market forces faced by firms as external driver. © 2021, Emerald Publishing Limited.
Emerald Group Holdings Ltd.
19852517
English
Article

author 2-s2.0-85113756977
spellingShingle 2-s2.0-85113756977
Product market competition, board gender diversity and corporate sustainability performance: international evidence
author_facet 2-s2.0-85113756977
author_sort 2-s2.0-85113756977
title Product market competition, board gender diversity and corporate sustainability performance: international evidence
title_short Product market competition, board gender diversity and corporate sustainability performance: international evidence
title_full Product market competition, board gender diversity and corporate sustainability performance: international evidence
title_fullStr Product market competition, board gender diversity and corporate sustainability performance: international evidence
title_full_unstemmed Product market competition, board gender diversity and corporate sustainability performance: international evidence
title_sort Product market competition, board gender diversity and corporate sustainability performance: international evidence
publishDate 2022
container_title Journal of Financial Reporting and Accounting
container_volume 20
container_issue 2
doi_str_mv 10.1108/JFRA-01-2021-0020
url https://www.scopus.com/inward/record.uri?eid=2-s2.0-85113756977&doi=10.1108%2fJFRA-01-2021-0020&partnerID=40&md5=5678c3d3d2c7accb29f9dc0a755c7c52
description Purpose: This study aims to investigate whether board gender diversity is associated with corporate sustainability performance and whether industry-level product market competition moderates the effect of board gender diversity on corporate sustainability performance. Design/methodology/approach: This study uses international data extracted from global ESG data set from Thomson Reuters (Refinitiv) database. Using data of 23,137 firm-year observations from 37 countries, the authors perform regression analyses to examine the hypotheses. Findings: The findings show that firms with high board gender diversity exhibit high corporate sustainability performance. The authors also find firms in highly competitive industries to have low corporate sustainability performance. In highly competitive industries, the positive relationship between board gender diversity and corporate sustainability performance is weakened. The results are robust to various specification tests such as alternative measures for corporate sustainability performance, board gender diversity, product market competition and also the use of propensity score matching to address endogeneity issue. Overall, the results support the prediction that board diversity and product market competition play a substitutive role in influencing corporate sustainability performance. Research limitations/implications: This study offers empirical evidence that the appointment of female directors is a useful way to improve a firm’s corporate sustainability performance, hence, providing significant benefits in terms of stakeholders’ values and corporate reputation. Practical implications: This study provides useful insights to investors and policymakers that intense industry competition might mitigate the role of board governance, particularly board gender diversity, in enhancing corporate sustainability performance. Originality/value: Using an international data set, where the observations operate in various market and institutional differences, this study is able to extricate the positive impact of board gender diversity and product market competition on corporate sustainability performance. This study corroborates evidence that sustainability strategy and initiatives are reflections of integrated factors, including corporate governance as internal driver and market forces faced by firms as external driver. © 2021, Emerald Publishing Limited.
publisher Emerald Group Holdings Ltd.
issn 19852517
language English
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