Greener Boards: Research on gender diversity and corporate environmental violations

Zahrani Aulia; Annisa Qurrota A'yun

doi:10.69725/aneva.v1i2.203

Authors

Zahrani Aulia a. Management, Vocational School, Diponegoro Unversity, Semarang, Indonesia
Annisa Qurrota A'yun b. Management, Vocational School, Diponegoro Unversity, Semarang, Indonesia

DOI:

https://doi.org/10.69725/aneva.v1i2.203

Keywords:

Gender Diversity, Gender of CEO, Environmental Violations, Corporate Governance, Sustainability Practices

Abstract

Purpose – This study aims to examine the effect of gender diversity on boards and gender of CEOs on environmental violations
Design/methodology/approach – The research employs a quantitative approach using regression analysis of data from 140 companies in Indonesia. Such as women on the board, female or male CEO, having environmental lawsuits, and different control variables such as size, leverage, and profitability.
Findings – We find that companies with larger fractions of female directors on their corporate boards and female CEOs are sued for fewer environmental harm cases. Moreover, firms with higher rates of women in leadership are also more likely to exhibit superior environmental disclosure and more proactive sustainability measures. In particular, female chief executive officers (CEOs) spend significantly more on environmental compliance, which then reduces the likelihood of environmental violations.
Originality/value – This paper adds to an increasing number of studies on gender diversity and corporate environmental sustainability, with a focus on an emerging market such as Indonesia. This allows it to find evidence for the positive impact of gender diversity in managing within business environments that are less risky to the ecology.
Research Implications – These findings have significant implications for both corporate governance and overall public policy: a move towards increased gender diversity among other senior-ranking leadership roles may indirectly promote environmentally conscious behaviour among Indonesian companies.

Downloads

Download data is not yet available.

Author Biographies

Zahrani Aulia, a. Management, Vocational School, Diponegoro Unversity, Semarang, Indonesia

Zahrani Aulia
Student data
Management, Vocational School, Diponegoro Unversity, Semarang, Indonesia
Annisa Qurrota A'yun, b. Management, Vocational School, Diponegoro Unversity, Semarang, Indonesia

Annisa Qurrota A'yun., S.E., MM
Lecture

References

Adhikari, Binay K., Anup Agrawal, and James Malm. 2019. “Do Women Managers Keep Firms out of Trouble? Evidence from Corporate Litigation and Policies.” Journal of Accounting and Economics 67(1):202–25. doi: https://doi.org/10.1016/j.jacceco.2018.09.004. DOI: https://doi.org/10.1016/j.jacceco.2018.09.004

Ararat, Melsa, Stijn Claessens, and B. Burcin Yurtoglu. 2021. “Corporate Governance in Emerging Markets: A Selective Review and an Agenda for Future Research.” Emerging Markets Review 48:100767. doi: https://doi.org/10.1016/j.ememar.2020.100767. DOI: https://doi.org/10.1016/j.ememar.2020.100767

Baah, Charles, Douglas Opoku-Agyeman, Innocent Senyo Kwasi Acquah, Yaw Agyabeng-Mensah, Ebenezer Afum, Daniel Faibil, and Farid Abdel Moro Abdoulaye. 2021. “Examining the Correlations between Stakeholder Pressures, Green Production Practices, Firm Reputation, Environmental and Financial Performance: Evidence from Manufacturing SMEs.” Sustainable Production and Consumption 27:100–114. doi: https://doi.org/10.1016/j.spc.2020.10.015. DOI: https://doi.org/10.1016/j.spc.2020.10.015

Birindelli, Giuliana, Antonia Patrizia Iannuzzi, and Marco Savioli. 2019. “The Impact of Women Leaders on Environmental Performance: Evidence on Gender Diversity in Banks.” Corporate Social Responsibility and Environmental Management 26(6):1485–99. doi: https://doi.org/10.1002/csr.1762. DOI: https://doi.org/10.1002/csr.1762

Cai, Xiang, Bangzhu Zhu, Haijing Zhang, Liang Li, and Meiying Xie. 2020. “Can Direct Environmental Regulation Promote Green Technology Innovation in Heavily Polluting Industries? Evidence from Chinese Listed Companies.” Science of The Total Environment 746:140810. doi: https://doi.org/10.1016/j.scitotenv.2020.140810. DOI: https://doi.org/10.1016/j.scitotenv.2020.140810

Chadwick, Ingrid C., and Alexandra Dawson. 2018. “Women Leaders and Firm Performance in Family Businesses: An Examination of Financial and Nonfinancial Outcomes.” Journal of Family Business Strategy 9(4):238–49. doi: https://doi.org/10.1016/j.jfbs.2018.10.002. DOI: https://doi.org/10.1016/j.jfbs.2018.10.002

Chams, Nour, and Josep García-Blandón. 2019a. “On the Importance of Sustainable Human Resource Management for the Adoption of Sustainable Development Goals.” Resources, Conservation and Recycling 141:109–22. doi: https://doi.org/10.1016/j.resconrec.2018.10.006. DOI: https://doi.org/10.1016/j.resconrec.2018.10.006

Chams, Nour, and Josep García-Blandón. 2019b. “Sustainable or Not Sustainable? The Role of the Board of Directors.” Journal of Cleaner Production 226:1067–81. doi: https://doi.org/10.1016/j.jclepro.2019.04.118. DOI: https://doi.org/10.1016/j.jclepro.2019.04.118

Cuervo-Cazurra, Alvaro, Marleen Dieleman, Paul Hirsch, Suzana B. Rodrigues, and Stelios Zyglidopoulos. 2021. “Multinationals’ Misbehavior.” Journal of World Business 56(5):101244. doi: https://doi.org/10.1016/j.jwb.2021.101244. DOI: https://doi.org/10.1016/j.jwb.2021.101244

Darvishmotevali, Mahlagha, and Levent Altinay. 2022. “Green HRM, Environmental Awareness and Green Behaviors: The Moderating Role of Servant Leadership.” Tourism Management 88:104401. doi: https://doi.org/10.1016/j.tourman.2021.104401. DOI: https://doi.org/10.1016/j.tourman.2021.104401

Erragragui, Elias, Jonathan Peillex, Mohammed Benlemlih, and Mohammad Bitar. 2023. “Stock Market Reactions to Corporate Misconduct: The Moderating Role of Legal Origin.” Economic Modelling 121:106197. doi: https://doi.org/10.1016/j.econmod.2023.106197. DOI: https://doi.org/10.1016/j.econmod.2023.106197

Freeman, R. Edward, and L. Reed David. 1983. “Stockholders and Stakeholders: A New Perspective on Corporate Governance.” California Management Review 25(3):88–106. doi: 10.2307/41165018. DOI: https://doi.org/10.2307/41165018

Gull, Ammar Ali, Mehdi Nekhili, Haithem Nagati, and Tawhid Chtioui. 2018. “Beyond Gender Diversity: How Specific Attributes of Female Directors Affect Earnings Management.” The British Accounting Review 50(3):255–74. doi: https://doi.org/10.1016/j.bar.2017.09.001. DOI: https://doi.org/10.1016/j.bar.2017.09.001

Gunawan, Juniati, Paulina Permatasari, and Carol Tilt. 2020. “Sustainable Development Goal Disclosures: Do They Support Responsible Consumption and Production?” Journal of Cleaner Production 246:118989. doi: https://doi.org/10.1016/j.jclepro.2019.118989. DOI: https://doi.org/10.1016/j.jclepro.2019.118989

Harjoto, Maretno A., Indrarini Laksmana, and Ya-wen Yang. 2018. “Board Diversity and Corporate Investment Oversight.” Journal of Business Research 90:40–47. doi: https://doi.org/10.1016/j.jbusres.2018.04.033. DOI: https://doi.org/10.1016/j.jbusres.2018.04.033

Hu, Bangyong, Nianjiao Peng, and Guoping Zhu. 2024. “Sustainable Finance in Natural Resource Extraction: Navigating Green Recovery Pathways.” Resources Policy 96:105197. doi: https://doi.org/10.1016/j.resourpol.2024.105197. DOI: https://doi.org/10.1016/j.resourpol.2024.105197

Issa, Ayman, and Nasrine Bensalem. 2023. “Are Gender-Diverse Boards Eco-Innovative? The Mediating Role of Corporate Social Responsibility Strategy.” Corporate Social Responsibility and Environmental Management 30(2):742–54. doi: https://doi.org/10.1002/csr.2385. DOI: https://doi.org/10.1002/csr.2385

Jensen, Michael C., and William H. Meckling. 2019. “Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure.” Corporate Governance: Values, Ethics and Leadership 77–132. doi: 10.4159/9780674274051-006. DOI: https://doi.org/10.4159/9780674274051-006

Konadu, Renata, Gabriel Sam Ahinful, Danquah Jeff Boakye, and Hany Elbardan. 2022. “Board Gender Diversity, Environmental Innovation and Corporate Carbon Emissions.” Technological Forecasting and Social Change 174:121279. doi: https://doi.org/10.1016/j.techfore.2021.121279. DOI: https://doi.org/10.1016/j.techfore.2021.121279

Lai, Jia Yen, Sam Staddon, and Alistair Hamilton. 2021. “Technical Experts’ Perspectives of Justice-Related Norms: Lessons from Everyday Environmental Practices in Indonesia.” Land Use Policy 102:105234. doi: https://doi.org/10.1016/j.landusepol.2020.105234. DOI: https://doi.org/10.1016/j.landusepol.2020.105234

Li, Haishan, and Peng Chen. 2018. “Board Gender Diversity and Firm Performance: The Moderating Role of Firm Size.” Business Ethics: A European Review 27(4):294–308. doi: https://doi.org/10.1111/beer.12188. DOI: https://doi.org/10.1111/beer.12188

Moreno-Ureba, Elena, Francisco Bravo-Urquiza, and Nuria Reguera-Alvarado. 2022. “An Analysis of the Influence of Female Directors on Environmental Innovation: When Are Women Greener?” Journal of Cleaner Production 374:133871. doi: https://doi.org/10.1016/j.jclepro.2022.133871. DOI: https://doi.org/10.1016/j.jclepro.2022.133871

Nadeem, Muhammad, Stephen Bahadar, Ammar Ali Gull, and Umer Iqbal. 2020. “Are Women Eco-Friendly? Board Gender Diversity and Environmental Innovation.” Business Strategy and the Environment 29(8):3146–61. doi: 10.1002/bse.2563. DOI: https://doi.org/10.1002/bse.2563

Oc, Burak. 2018. “Contextual Leadership: A Systematic Review of How Contextual Factors Shape Leadership and Its Outcomes.” The Leadership Quarterly 29(1):218–35. doi: https://doi.org/10.1016/j.leaqua.2017.12.004. DOI: https://doi.org/10.1016/j.leaqua.2017.12.004

Qin, Yan, Julie Harrison, and Li Chen. 2019. “A Framework for the Practice of Corporate Environmental Responsibility in China.” Journal of Cleaner Production 235:426–52. doi: https://doi.org/10.1016/j.jclepro.2019.06.245. DOI: https://doi.org/10.1016/j.jclepro.2019.06.245

Saeed, Abubakr, Hammad Riaz, Tahiru Azaaviele Liedong, and Tazeeb Rajwani. 2022. “The Impact of TMT Gender Diversity on Corporate Environmental Strategy in Emerging Economies.” Journal of Business Research 141:536–51. doi: https://doi.org/10.1016/j.jbusres.2021.11.057. DOI: https://doi.org/10.1016/j.jbusres.2021.11.057

Scheidel, Arnim, Daniela Del Bene, Juan Liu, Grettel Navas, Sara Mingorría, Federico Demaria, Sofía Avila, Brototi Roy, Irmak Ertör, Leah Temper, and Joan Martínez-Alier. 2020. “Environmental Conflicts and Defenders: A Global Overview.” Global Environmental Change 63:102104. doi: https://doi.org/10.1016/j.gloenvcha.2020.102104. DOI: https://doi.org/10.1016/j.gloenvcha.2020.102104

Stahl, Günter K., Chris J. Brewster, David G. Collings, and Aida Hajro. 2020. “Enhancing the Role of Human Resource Management in Corporate Sustainability and Social Responsibility: A Multi-Stakeholder, Multidimensional Approach to HRM.” Human Resource Management Review 30(3):100708. doi: https://doi.org/10.1016/j.hrmr.2019.100708. DOI: https://doi.org/10.1016/j.hrmr.2019.100708

Sumarno, Theresia B., Parulian Sihotang, and Widhyawan Prawiraatmadja. 2022. “Exploring Indonesia’s Energy Policy Failures through the JUST Framework.” Energy Policy 164:112914. doi: https://doi.org/10.1016/j.enpol.2022.112914. DOI: https://doi.org/10.1016/j.enpol.2022.112914

Tacconi, Luca, Rafael J. Rodrigues, and Ahmad Maryudi. 2019. “Law Enforcement and Deforestation: Lessons for Indonesia from Brazil.” Forest Policy and Economics 108:101943. doi: https://doi.org/10.1016/j.forpol.2019.05.029. DOI: https://doi.org/10.1016/j.forpol.2019.05.029

Thomas, Sebastian, Max Richter, Widia Lestari, Shiskha Prabawaningtyas, Yudo Anggoro, and Iskandar Kuntoadji. 2018. “Transdisciplinary Research Methods in Community Energy Development and Governance in Indonesia: Insights for Sustainability Science.” Energy Research & Social Science 45:184–94. doi: https://doi.org/10.1016/j.erss.2018.06.021. DOI: https://doi.org/10.1016/j.erss.2018.06.021

Vuong, Quan-Hoang, Viet-Phuong La, Hong-Kong T. Nguyen, Manh-Tung Ho, Thu-Trang Vuong, and Manh-Toan Ho. 2021. “Identifying the Moral–Practical Gaps in Corporate Social Responsibility Missions of Vietnamese Firms: An Event-Based Analysis of Sustainability Feasibility.” Corporate Social Responsibility and Environmental Management 28(1):30–41. doi: https://doi.org/10.1002/csr.2029. DOI: https://doi.org/10.1002/csr.2029

Wang, Yilei, Deniz S. Ones, Yagizhan Yazar, and Ipek Mete. 2023. “Board Gender Diversity and Organizational Environmental Performance: An International Perspective.” Current Research in Ecological and Social Psychology 5:100164. doi: https://doi.org/10.1016/j.cresp.2023.100164. DOI: https://doi.org/10.1016/j.cresp.2023.100164

Zaman, Rashid. 2024. “When Corporate Culture Matters: The Case of Stakeholder Violations.” The British Accounting Review 56(1):101188. doi: https://doi.org/10.1016/j.bar.2023.101188. DOI: https://doi.org/10.1016/j.bar.2023.101188