Document Type
Journal Article
Publication Title
Corporate Governance: An International Review
Publisher
Wiley
School
School of Business and Law
RAS ID
58131
Funders
Open access publishing facilitated by The University of Queensland, as part of the Wiley - The University of Queensland agreement via the Council of Australian University Librarian
Abstract
Research question/issue: We examine whether and how board diversity, measured by demographics (i.e., board gender, cultural diversity, tenure, social capital, expertise, and age) and structural diversity (i.e., board independence, size, board seat accumulation-chair, board compensation, and board meeting frequency), influence corporate eco-innovation. Research findings/insights: Utilizing a global sample of publicly listed companies for the period 2004–2019, we find that a one-standard deviation increase in demographic and structural diversity translates into 4.66% and 7.11% higher corporate eco-innovation, respectively. Furthermore, we discover that demographic and structural diversity promotes eco-innovation by offsetting the negative effects of political risk. In an additional analysis, we find evidence that, in the absence of greater external monitoring (institutional investors and analyst following), organizations benefit more from the monitoring role of board diversity. Theoretical/academic implications: By adopting the concept of “bundling the governance mechanisms,” our study adds to the ongoing discourse about the function of board diversity in addressing corporate climate footprints by offering original evidence that board diversity heterogeneity—demographic and structural diversity—matters for corporate eco-innovation. Practitioner/policy implications: Given the increasing pressure on companies to manage their environmental impacts and carbon footprints, our paper has significant ramifications for those involved in promoting eco-innovative business practices, such as policymakers, regulators, and practitioners.
DOI
10.1111/corg.12545
Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.
Included in
Business Administration, Management, and Operations Commons, Business Law, Public Responsibility, and Ethics Commons
Comments
Zaman, R., Asiaei, K., Nadeem, M., Malik, I., & Arif, M. (2023). Board demographic, structural diversity, and eco-innovation: International evidence. Corporate Governance: An International Review. Advance online publication. https://doi.org/10.1111/corg.12545