Board gender diversity and environmental, social and governance (ESG) disclosure: assessing the moderating role of country-level accountability and governance

Shaista Wasiuzzaman and Effiezal Aswadi Abdul Wahab

Pacific Accounting Review, 2025, vol. 37, issue 3, 420-454

Abstract: Purpose - The purpose of this paper is to investigate the moderating role of country-level accountability and governance in influencing the relationship between board gender diversity and environmental, social and governance (ESG) disclosure. Design/methodology/approach - The sample consists of 3,456 firm-year observations from 37 countries, collected from the Bloomberg database, while the data for country-level accountability and governance were gathered from the GovData360 database, an initiative of the World Bank’s Governance Global Practice. Ordinary Least Squares regression analysis with fixed time effects and robust standard errors clustered at the firm level is used on panel data from energy firms worldwide between 2009 and 2016. Findings - The authors find a positive relationship between board gender diversity and ESG disclosure. Further, the relationship between board gender diversity and ESG disclosure is stronger in countries with high levels of accountability. The findings of this study remain consistent for countries with high levels of board efficacy. However, the authors find insignificant results when considering the level of enforcement of accounting and auditing standards. The results of this study remain consistent across a range of endogeneity and additional analyses. Practical implications - The authors show that country-level regulatory forces influence firm activities and decisions, but the impact of various forces varies. In particular, they highlight that normative forces have a greater influence than regulative forces. Therefore, they emphasize the importance of country-level accountability and enforcement in shaping firm-level governance and decision-making. Originality/value - This study incorporates country-level accountability and governance, which encompasses the enforcement of accounting and auditing standards as well as the efficacy of the board of directors. Furthermore, to the best of the authors’ knowledge, no study has yet considered the institutional and legal aspects in exploring the link between board gender diversity and ESG disclosure.

Keywords: Board gender diversity; ESG disclosure; Accountability; Governance; G3; G14; M14; M41 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:parpps:par-09-2024-0216

DOI: 10.1108/PAR-09-2024-0216

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