Sustainable corporate governance and non-financial disclosure in Europe: does the gender diversity matter?

Giuseppe Nicolò, Giovanni Zampone, Giuseppe Sannino and Serena De Iorio

Journal of Applied Accounting Research, 2021, vol. 23, issue 1, 227-249

Abstract: Purpose - Recent regulatory changes in Europe have promoted non-financial reporting practices (e.g., Directive, 2014/95/EU) and gender diversity in decision-making positions. Special attention is devoted to promoting the gender balance on corporate boards as a key mechanism to enhance corporate governance effectiveness and better address multiple stakeholders' needs. With this in mind, this study intends to examine the impact of boardroom gender diversity on Environmental Social Governance (ESG) disclosure practices in the European listed firms' context. Design/methodology/approach - The study applies different panel data models on an extended sample of 1,392 firms from 21 European Union (EU) countries for six years (2014–2019). Findings - Findings allow to spotlight the positive role exerted by the presence of women directors on the boards in enhancing ESG disclosure, both at the overall and specific (individual ESG scores) level. Research limitations/implications - Policymakers and regulators might consider the study's evidence as a stimulus to continue in promoting strategic actions and reforms that foster gender equality and balance in corporate decision-making positions. Practical implications - Creating a heterogeneous and diversified board of directors may support implementing a “sustainable corporate governance” recently claimed by the EC. Originality/value - The study contributes to the literature by disentangling the links between gender diversity and ESG disclosure over a period that covers a long season of European regulations and measures that affected both non-financial reporting practices and the board of directors' composition. Accordingly, it can contribute to enhancing the practical and theoretical understanding of the pivotal role that gender diversity may exert in strengthening corporate governance and, in turn, corporate transparency and accountability behaviours about non-financial issues.

Keywords: Gender diversity; Corporate governance; ESG disclosure; Corporate social responsibility; Sustainable corporate governance; Directive 2014/95/EU (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:jaarpp:jaar-04-2021-0100

DOI: 10.1108/JAAR-04-2021-0100

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