Abstract:

Board composition plays a pivotal role in shaping how firms integrate environmental, social, and governance (ESG) priorities into corporate strategy. Drawing on resource dependence theory and upper echelons theory, this study examines how women on boards (WOB) influence ESG performance and whether this relationship is conditioned by national culture. Using firm-level panel data from G7 countries for eight years, we tested whether five of the Hofstede national cultural dimensions (individualism, uncertainty avoidance, long-termism, masculinity, and power distance) moderate the positive association between WOB and ESG performance. G7 countries represent advanced market economies with well-developed capital markets, strong institutional and governance norms, and relatively high-quality ESG disclosures. This institutional comparability reduces noise arising from weak regulatory environments or poor data reliability. Although G7 countries are similar in terms of economic development and regulatory systems, they differ considerably in their cultural values. This mix of institutional similarity and cultural diversity provides a useful setting to examine the moderating role of national culture on the WOB-ESG relationship without confounding effects from the extreme differences in economic development. Our findings suggest a statistically significant positive association between WOB and ESG performance, moderated positively by uncertainty avoidance, long-termism, and power distance, and negatively by individualism. Masculinity does not have a significant moderating effect.

Please choose your submission type: Developmental Paper

Primary Track: Corporate Governance

Keywords: Self-Governance and Internal Corporate Governance Mechanisms ;Ownership and Board Structure ;Boards of Directors and Top Management Teams ;Sustainable governance (SDG goals) ;Comparative Corporate Governance

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Dr. Prachi Bhatt

Biography