How Board Gender Diversity Influences the Relationship between ESG Performance and Corporate Risk-Taking
Main Article Content
Abstract
This study investigates the impact of environmental, social, and governance (ESG) performance on corporate financial risk, focusing on the moderating role of board gender diversity (BGD). Analyzing French companies listed in the SBF 120 index from 2013 to 2022, the research excludes financial and real estate firms, resulting in a sample of 97 companies with 970 observations. The findings reveal that strong ESG practices lead to lower market volatility and financial risks, with gender-diverse boards—especially those with female directors—enhancing ESG performance. The study highlights the importance of promoting gender diversity in leadership to improve ESG performance and overall risk management strategies.
Article Details

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
How to Cite
References
Adams, B., Licht, A. N., & Sagiv, L. (2011). Shareholders and stakeholders: How do directors decide? Strategic Management Journal, 32(12), 1331-1355. https://doi.org/10.1002/smj.976
Aouadi, A., & Marsat, S. (2018). Do ESG controversies matter for firm value? Evidence from international data. Journal of Business Ethics, 151, 1027-1047. https://doi.org/10.1007/s10551-016-3242-6
Arayssi, M., Jizi, M., & Tabaja, H. H. (2020). The impact of board composition on the level of ESG disclosures in GCC countries. Sustainability Accounting, Management and Policy Journal, 11(1), 137-161. https://doi.org/10.1108/SAMPJ-02-2019-0148
Ashwin Kumar, N. C., Smith, C., Badis, L., Wang, N., Ambrosy, P., & Tavares, R. (2016). ESG factors and risk-adjusted performance: A new quantitative model. Journal of Sustainable Finance & Investment, 6(4), 292-300. https://doi.org/10.1080/20430795.2016.1228310
Aureli, S., Gigli, S., Medei, R., & Supino, E. (2020). The value relevance of environmental, social, and governance disclosure: Evidence from Dow Jones Sustainability World Index listed companies. Corporate Social Responsibility and Environmental Management, 27(1), 43-52. https://doi.org/10.1002/csr.1740
Benlemlih, M., & Girerd‐Potin, I. (2017). Corporate social responsibility and firm financial risk reduction: On the moderating role of the legal environment. Journal of Business Finance & Accounting, 44(7-8), 1137-1166. https://doi.org/10.1111/jbfa.12222
Centinaio, A. (2024). How gender diversity in boards affects disclosure? A literature review. Corporate Social Responsibility and Environmental Management, 31(3), 2352-2382.
Chakraborty, A., Gao, L. S., & Sheikh, S. (2019). Managerial risk taking incentives, corporate social responsibility and firm risk. Journal of Economics and Business, 101, 58-72. https://doi.org/10.1016/j.jeconbus.2018.10.001
Chollet, P., & Sandwidi, B. W. (2018). CSR engagement and financial risk: A virtuous circle? International evidence. Global Finance Journal, 38, 65-81. https://doi.org/10.1016/j.gfj.2018.01.001
Cucari, N., Esposito de Falco, S., & Orlando, B. (2018). Diversity of board of directors and environmental social governance: Evidence from Italian listed companies. Corporate Social Responsibility and Environmental Management, 25(3), 250-266. https://doi.org/10.1002/csr.1464
Cumming, D., Leung, T. Y., & Rui, O. (2015). Gender diversity and securities fraud. Academy of Management Journal, 58(5), 1572-1593. https://doi.org/10.5465/amj.2013.0317
Dadanlar, H. H., & Abebe, M. A. (2020). Female CEO leadership and the likelihood of corporate diversity misconduct: Evidence from S&P 500 firms. Journal of Business Research, 118, 398-405. https://doi.org/10.1016/j.jbusres.2020.06.056
Dutordoir, M., Schoubben, F., Struyfs, K., & Torsin, W. (2024). Environmental pressure and board gender diversity: Evidence from the European Union Emission Trading System. Business Strategy and the Environment.
Fiaschi, D., Giuliani, E., Nieri, F., & Salvati, N. (2020). How bad is your company? Measuring corporate wrongdoing beyond the magic of ESG metrics. Business Horizons, 63(3), 287-299. https://doi.org/10.1016/j.bushor.2020.01.002
Freeman, R. E. (2010). Strategic management: A stakeholder approach. Cambridge University Press.
Glass, C., Cook, A., & Ingersoll, A. R. (2016). Do women leaders promote sustainability? Analyzing the effect of corporate governance composition on environmental performance. Business Strategy and the Environment, 25(7), 495-511. https://doi.org/10.1002/bse.1935
Godfrey, P. C. (2005). The relationship between corporate philanthropy and shareholder wealth: A risk management perspective. Academy of Management Review, 30(4), 777-798. https://doi.org/10.5465/amr.2005.18378877
Handajani, L., Subroto, B., Sutrisno, T., & Saraswati, E. (2014). Does board diversity matter on corporate social disclosure? An Indonesian evidence. Journal of Economics and Sustainable Development, 5(12), 8-16. https://doi.org/10.5539/jesd.v5n12p8
He, F., Ding, C., Yue, W., & Liu, G. (2023). ESG performance and corporate risk-taking: Evidence from China. International Review of Financial Analysis, 87, 102550. https://doi.org/10.1016/j.irfa.2023.102550
Jia, Y., Gao, X., & Julian, S. (2020). Do firms use corporate social responsibility to insure against stock price risk? Evidence from a natural experiment. Strategic Management Journal, 41(2), 290-307. https://doi.org/10.1002/smj.3115
Kyaw, K., Olugbode, M., & Petracci, B. (2017). Can board gender diversity promote corporate social performance? Corporate Governance: The International Journal of Business in Society. https://doi.org/10.1108/CG-12-2015-0134
Liu, C. (2018). Are women greener? Corporate gender diversity and environmental violations. Journal of Corporate Finance, 52, 118-142. https://doi.org/10.1016/j.jcorpfin.2018.06.007
Lueg, K., Krastev, B., & Lueg, R. (2019). Bidirectional effects between organizational sustainability disclosure and risk. Journal of Cleaner Production, 229, 268-277. https://doi.org/10.1016/j.jclepro.2019.04.347
Manita, R., Bruna, M. G., Dang, R., & Houanti, L. H. (2018). Board gender diversity and ESG disclosure: Evidence from the USA. Journal of Applied Accounting Research. https://doi.org/10.1108/JAAR-01-2018-0026
Martiny, A., Taglialatela, J., Testa, F., & Iraldo, F. (2024). Determinants of environmental social and governance (ESG) performance: A systematic literature review. Journal of Cleaner Production, 456, 142213.
Murphy, K., Strand, L., Theron, L., & Ungar, M. (2021). “I just gotta have tough skin”: Women's experiences working in the oil and gas industry in Canada. The Extractive Industries and Society, 8(2), 100882. https://doi.org/10.1016/j.exis.2021.100882
Nadeem, M., Suleman, T., & Ahmed, A. (2019). Women on boards, firm risk and the profitability nexus: Does gender diversity moderate the risk and return relationship? International Review of Economics & Finance, 64, 427-442. https://doi.org/10.1016/j.iref.2019.03.007
Nadeem, M., Zaman, R., & Saleem, I. (2017). Boardroom gender diversity and corporate sustainability practices: Evidence from Australian Securities Exchange listed firms. Journal of Cleaner Production, 149, 874-885. https://doi.org/10.1016/j.jclepro.2017.02.089
Qayyum, A., Rehman, I. U., Shahzad, F., Khan, N., Nawaz, F., Kokkalis, P., & Sergi, B. S. (2021). Board gender diversity and stock price crash risk: Going beyond tokenism. Borsa Istanbul Review, 21(3), 269-280. https://doi.org/10.1016/j.bir.2021.01.001
Rao, K., & Tilt, C. (2016). Board composition and corporate social responsibility: The role of diversity, gender, strategy and decision making. Journal of Business Ethics, 138, 327-347. https://doi.org/10.1007/s10551-015-2618-4
Reber, B., Gold, A., & Gold, S. (2022). ESG disclosure and idiosyncratic risk in initial public offerings. Journal of Business Ethics, 179(3), 867-886. https://doi.org/10.1007/s10551-021-04948-4
Sassen, R., Hinze, A. K., & Hardeck, I. (2016). Impact of ESG factors on firm risk in Europe. Journal of Business Economics, 86, 867-904. https://doi.org/10.1007/s11573-016-0835-3
Sbai, H., & Ed-Dafali, S. (2023). Gender diversity and risk-taking: Evidence from dual banking systems. Journal of Financial Reporting and Accounting. https://doi.org/10.1108/JFRA-09-2022-0399
Shahbaz, M., Karaman, A. S., Kilic, M., & Uyar, A. (2020). Board attributes, CSR engagement, and corporate performance: What is the nexus in the energy sector? Energy Policy, 143, 111582. https://doi.org/10.1016/j.enpol.2020.111582
Shakil, M. H. (2021). Environmental, social and governance performance and financial risk: Moderating role of ESG controversies and board gender diversity. Resources Policy, 72, 102144. https://doi.org/10.1016/j.resourpol.2021.102144
Shakil, M. H. (2022). Environmental, social and governance performance and stock price volatility: A moderating role of firm size. Journal of Public Affairs, 22(3), e2574. https://doi.org/10.1002/pa.2574
Sharfman, M. P., & Fernando, C. S. (2008). Environmental risk management and the cost of capital. Strategic Management Journal, 29(6), 569-592. https://doi.org/10.1002/smj.673
Sila, V., Gonzalez, A., & Hagendorff, J. (2016). Women on board: Does boardroom gender diversity affect firm risk? Journal of Corporate Finance, 36, 26-53. https://doi.org/10.1016/j.jcorpfin.2015.11.002
Singh, V., Terjesen, S., & Vinnicombe, S. (2008). Newly appointed directors in the boardroom: How do women and men differ? European Management Journal, 26(1), 48-58. https://doi.org/10.1016/j.emj.2007.09.005
Skała, D., & Weill, L. (2018). Does CEO gender matter for bank risk? Economic Systems, 42(1), 64-74. https://doi.org/10.1016/j.ecosys.2017.09.002
Wei, L., & Chengshu, W. (2024). Company ESG performance and institutional investor ownership preferences. Business Ethics, the Environment & Responsibility, 33(3), 287-307.
Widyawati, L. (2020). A systematic literature review of socially responsible investment and environmental social governance metrics. Business Strategy and the Environment, 29(2), 619-637. https://doi.org/10.1002/bse.2643