Effect of board structure on stakeholders’ centric perspective of sustainable corporate world
Abstract
Purpose
Corporate leadership and environmental, social and governance (ESG) performance are closely intertwined, as effective corporate leadership can facilitate the achievement of strong ESG performance. Thus, the purpose of the study is to investigate the impact of corporate board leadership on the ESG performance of listed firms.
Design/methodology/approach
The sample has been taken from the listed firms of the Nifty 500 index spanning the period of 10 years from 2012 to 2022. Dynamic panel data estimations are applied through a fixed effect model.
Findings
The findings of this study revealed that board size, board independence and board qualification have a significant positive influence on ESG performance. It is evident that good corporate governance practices can positively influence ESG performance by fostering accountability, transparency and ethical behavior, as well as better integrating ESG considerations into their decision-making processes and ensuring that ESG issues are prioritized at the highest levels of management. Further findings also revealed that chief executive officer (CEO) duality has a significant negative relationship with ESG performance, which goes against the belief of stakeholder theory.
Social implications
It has practical implications for policymakers, as they can enact new regulations pertaining to the CEO’s position in the organizations to make corporate governance responsible for improved sustainability and ESG performance.
Originality/value
There are very few studies analyzing the impact of corporate board structure on ESG performance related to emerging markets. Thus, this study contributes to that literature by using the methodology GMM panel data for the first time as per our knowledge
Keywords
Acknowledgements
Contribution: Basit Ali Bhat (corresponding author) and Manpreet Kaur Makkar have contributed in all parts of this article, from content writing to reference framing (both the scholars have sustainability as their core area of PhD). Dr Nitin Gupta has selected the article area and title as well as proofread it thrice during the writing course.
Citation
Bhat, B.A., Makkar, M.K. and Gupta, N. (2023), "Effect of board structure on stakeholders’ centric perspective of sustainable corporate world", Journal of Global Responsibility, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JGR-03-2023-0036
Publisher
:Emerald Publishing Limited
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