Breaking Barriers: Gender Diversity, ESG, and Corporate Misconduct in the GCC Region

Laila Aladwey, Mohamed Fawzy Mohamed Elsayed () and Ahmed Diab
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Laila Aladwey: Accounting Department, Imam Mohammad Ibn Saud Islamic University (IMSIU), Riyadh 11432, Saudi Arabia
Mohamed Fawzy Mohamed Elsayed: Accounting Department, Imam Mohammad Ibn Saud Islamic University (IMSIU), Riyadh 11432, Saudi Arabia
Ahmed Diab: Accounting Department, Prince Sultan University, Riyadh 12435, Saudi Arabia

Risks, 2025, vol. 13, issue 5, 1-22

Abstract: Our study explores how ESG performance affects corporate misconduct (CM) in Gulf Cooperation Council (GCC) firms and whether having more women on corporate boards influences this relationship. Using logistic regression and using data collected from GCC firms, we analyse the moderating effect of board gender diversity (BGD) on the relationship between ESG and CM. Our findings show that strong ESG performance reduces CM, and greater BGD further decreases misconduct. Moreover, gender-diverse boards strengthen the link between ESG and lower CM rates. This study contributes to the literature by examining how BGD influences the ESG-CM relationship in the GCC region. The current findings are valuable for investors, businesses, and policymakers. Investors should prioritize companies with strong ESG practices and diverse boards to minimize the risks they might face. Businesses should integrate female directors on boards to enhance ethical practices. Policymakers can promote corporate responsibility by incentivizing gender diversity and ESG adoption, which is crucial for a more transparent and accountable business environment.

Keywords: board gender diversity; ESG; sustainability; misconduct; GCC (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2025
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