Board/Executive Gender Diversity and Firm Financial Performance in Canada: The Mediating Role of Environmental, Social, and Governance (ESG) Orientation

Zeineb Ouni, Jamal Ben Mansour and Sana Arfaoui
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Zeineb Ouni: Department of Economics and Finance, School of Management, University of Quebec in Trois-Rivières, 3351 des Forges BLVD., P.O. Box 500, Trois-Rivières, QC G9A 5H7, Canada
Jamal Ben Mansour: Department of Human Resources Management, School of Management, University of Quebec in Trois-Rivières, 3351 des Forges BLVD., P.O. Box 500, Trois-Rivières, QC G9A 5H7, Canada
Sana Arfaoui: Banque Nationale du Canada, 201, boul. Curé Labelle, Laval, QC H7V 2R9, Canada

Sustainability, 2020, vol. 12, issue 20, 1-17

Abstract: The objective of this study is to verify the effect of gender diversity on the board of directors (BD) and the executive committee (EC) of participating Canadian firms with regard to the financial performance and the mediating role of environmental, social, and governance (ESG) orientation in this relationship. The study sample was composed of 133 Canadian firms, and the data cover an 18 year timeline (2002–2019), with 925 observations. This paper provides empirical support for the effect that gender diversity in turnover has on the financial performance of firms and explains 53% of its variance. In addition to supporting the beneficial effect of gender diversity on performance, the study reveals the mediating mechanism through the ESG orientation of companies explaining almost 4% of the total effect of gender diversity on performance. By analyzing two levels of diversity, the study revealed the superiority of the effect of gender diversity in BDs as compared to ECs. We discuss the theoretical and empirical implications of the results found, as well as the limitations and future prospects of research on the subject.

Keywords: board of directors; gender diversity; executive committee; financial performance; ESG; Canadian firms (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:12:y:2020:i:20:p:8386-:d:426688

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