BOARD GENDER DIVERSITY, AUDIT COMMITTEE INDEPENDENCE AND ENVIRONMENTAL, SOCIAL AND GOVERNANCE PERFORMANCE
DOI:
https://doi.org/10.33736/ijbs.8928.2025Keywords:
Gender Diversity, Audit Committee, Corporate Governance, ESGAbstract
This research aims to explore the link between gender balance on boards, audit committee independence and environmental, social and governance (ESG) performance, exploring whether these factors act as substitutes or complements in driving corporate ESG commitment. Through a data analysis involving 20,103 observations over the period 2011-2020, we examined firm-year data from 41 countries. The findings support resource dependence theory, revealing a positive association between female board representation and ESG performance. Furthermore, reflecting the audit committee's active monitoring role, the study finds that the positive impact of board gender diversity on ESG performance is amplified in firms with more independent audit committees. These international findings suggest policy implications for promoting both board gender diversity and audit committee independence to enhance corporate ESG engagement globally.
References
Abbott, L., Parker, S., & Peters, G. (2004). Audit committee characteristics and restatements. Auditing: A Journal of Practice & Theory, 23(1), 69-87. https://doi.org/10.2308/aud.2004.23.1.69
https://doi.org/10.2308/aud.2004.23.1.69
Adams, R., Haan, J., Terjesen, S., & Ees, H. (2015). Board diversity: Moving the field forward. Corporate Governance: An International Review, 23(2), 77-82. https://doi.org/10.1111/corg.12106
https://doi.org/10.1111/corg.12106
Adeneye, Y., Kammoun, I., & Wahab, S. (2022). Capital structure and speed of adjustment: The impact of environmental, social and governance performance. Sustainability Accounting, Management and Policy Journal, 14(5), 945-977. https://doi.org/10.1108/sampj-01-2022-0060
https://doi.org/10.1108/SAMPJ-01-2022-0060
Ahmed, A. & Ali, S. (2017). Boardroom gender diversity and stock liquidity: Evidence from Australia. Journal of Contemporary Accounting & Economics, 13(2), 148-165. https://doi.org/10.1016/j.jcae.2017.06.001
https://doi.org/10.1016/j.jcae.2017.06.001
Aguilera, R. V., Desender, K. A., & Kabbach de Castro, L. R. (2012). A bundle perspective to comparative corporate governance. In T. Clarke & D. M. Branson (Eds.), The SAGE handbook of corporate governance: 379405. London: SAGE Publications Ltd.
https://doi.org/10.4135/9781446200995.n18
Al-Rahahleh, A. (2017). Corporate governance quality, board gender diversity and corporate dividend policy: Evidence from Jordan. Australasian Accounting Business and Finance Journal, 11(2). https://doi.org/10.14453/aabfj.v11i2.6
https://doi.org/10.14453/aabfj.v11i2.6
Alodat, A. Y., & Hao, Y. (2024). Environmental, social and governance disclosure and firm performance: Moderating role of board gender diversity and sustainability committee. Sustainable Development, 1-16. https://doi.org/10.1002/sd.3126
https://doi.org/10.1002/sd.3126
Arayssi, M., Jizi, M., & Tabaja, 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-05-2018-0136
https://doi.org/10.1108/SAMPJ-05-2018-0136
Arif, M., Sajjad, A., Farooq, S., Abrar, M., & Joyo, A. S. (2020). The impact of audit committee attributes on the quality and quantity of environmental, social and governance disclosures. Corporate Governance: The International Journal of Business in Society, 21(3), 497-514. https://doi.org/10.1108/cg-06-2020-0243
https://doi.org/10.1108/CG-06-2020-0243
Biswas, P. K., Mansi, M., & Pandey, R. (2018). Board composition, sustainability committee and corporate social and environmental performance in Australia. Pacific Accounting Review, 30(4), 517-540. https://doi.org/10.1108/PAR-12-2017-0107
https://doi.org/10.1108/PAR-12-2017-0107
Boo, E. & Sharma, D. (2008). Effect of regulatory oversight on the association between internal governance characteristics and audit fees. Accounting and Finance, 48(1), 51-71. https://doi.org/10.1111/j.1467-629x.2007.00229.x
https://doi.org/10.1111/j.1467-629X.2007.00229.x
Brennan, N.M. & Solomon, J. (2008). Corporate governance, accountability and mechanisms of accountability: An overview. Accounting, Auditing & Accountability. 21(7), 885-906. https://doi.org/10.1108/09513570810907401
https://doi.org/10.1108/09513570810907401
Cheung, K. Y. & Lai, C. Y. (2023). The impacts of business ethics and diversity on ESG disclosure: Evidence from Hong Kong. Journal of Corporate Accounting & Finance, 34(4), 208-221. https://doi.org/10.1002/jcaf.22644
https://doi.org/10.1002/jcaf.22644
Cucari, N., Falco, S. E. D., & Orlando, B. (2017). 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.1452
https://doi.org/10.1002/csr.1452
Deloitte (2024). Women in the Boardroom: A Global Perspective. Deloitte Insights. 8, 1-260. https://www.deloitte.com/global/en/about/press-room/deloitte-global-latest-women-in-the-boardroom-report.html
Dey, A. (2008). Corporate governance and agency conflicts. Journal of Accounting Research, 46(5), 1143-1181. https://doi.org/10.1111/j.1475-679x.2008.00301.x
https://doi.org/10.1111/j.1475-679X.2008.00301.x
Disli, M., Yilmaz, M., & Mohamed, F. (2022). Board characteristics and sustainability performance: Empirical evidence from emerging markets. Sustainability Accounting, Management and Policy Journal, 13(4), 929-952. https://doi.org/10.1108/sampj-09-2020-0313
https://doi.org/10.1108/SAMPJ-09-2020-0313
Farooque, O. (2021). Agency-linked risk management with ownership and board sub-committee governance: Evidence from an OECD economy. Journal of Risk and Financial Management, 14(10), 472. https://doi.org/10.3390/jrfm14100472
https://doi.org/10.3390/jrfm14100472
Friedman, M. (2007). The social responsibility of business is to increase its profits. In W. C. Zimmerli, M. Holzinger, & K. Richter (Eds.), Corporate ethics and corporate governance (pp. 173-178). Berlin, Heidelberg: Springer
https://doi.org/10.1007/978-3-540-70818-6_14
Gholami, A., Sands, J., & Shams, S. (2022). Corporates' sustainability disclosures impact on cost of capital and idiosyncratic risk. Meditari Accountancy Research, 31(4), 861-886. https://doi.org/10.1108/medar-06-2020-0926
https://doi.org/10.1108/MEDAR-06-2020-0926
Guizani, M. & Abdalkrim, G. (2021). Board gender diversity, financial decisions and free cash flow: Empirical evidence from Malaysia. Management Research Review, 45(2), 198-216. https://doi.org/10.1108/mrr-03-2021-0246
https://doi.org/10.1108/MRR-03-2021-0246
Gurol, B. & Lagasio, V. (2022). Women board members' impact on ESG disclosure with environment and social dimensions: Evidence from the European banking sector. Social Responsibility Journal, 19(1), 211-228. https://doi.org/10.1108/srj-08-2020-0308
https://doi.org/10.1108/SRJ-08-2020-0308
Haque, F. & Jones, M. J. (2020). European firms' corporate biodiversity disclosures and board gender diversity from 2002 to 2016. The British Accounting Review, 52, 1-17. https://ssrn.com/abstract=3786233
https://doi.org/10.1016/j.bar.2020.100893
Hillman, A. J., Shropshire, C., & Cannella, A. A. (2007). Organizational predictors of women on corporate boards. Academy of Management Journal, 50(4), 941-952. https://doi.org/10.5465/amj.2007.26279222
https://doi.org/10.5465/amj.2007.26279222
Huber, P. J. (1964). Robust estimation of a location parameter. Annals of Mathematical Statistics, 35, 73-101.
https://doi.org/10.1214/aoms/1177703732
Ibrahim, M., Mahmood, N., & Hamza, M. A. (2023). Moderator effect of audit committee on earnings management and board diversity. International Journal of Management, Finance and Accounting, 4(1), 37-51. https://doi.org/10.33093/ijomfa.2023.4.1.3
https://doi.org/10.33093/ijomfa.2023.4.1.3
Issa, A. (2023). Shaping a sustainable future: The impact of board gender diversity on clean energy use and the moderating role of environmental, social and governance controversies. Corporate Social Responsibility and Environmental Management, 30(6), 2731-2746. https://doi.org/10.1002/csr.2512
https://doi.org/10.1002/csr.2512
Kamarudin, K., Ariff, A., & Ismail, W. (2021). Product market competition, board gender diversity and corporate sustainability performance: International evidence. Journal of Financial Reporting and Accounting, 20(2), 233-260. https://doi.org/10.1108/jfra-01-2021-0020
https://doi.org/10.1108/JFRA-01-2021-0020
Kassinis, G. I., Panayiotou, A., Dimou, A., & Katsifaraki, G. D. (2016). Gender and environmental sustainability: A longitudinal analysis. Corporate Social Responsibility and Environmental Management, 23(6), 399-412. https://doi.org/10.1002/csr.1386
https://doi.org/10.1002/csr.1386
Kaul, S. (2023). ESG and value creation in private equity investments: Analysing the effects. Asian Journal of Interdisciplinary Research, 1-7. https://doi.org/10.54392/ajir2331
https://doi.org/10.54392/ajir2331
Kennedy, P. (2008), A Guide to Econometrics, 6th ed., Wiley-Blackwell.
Kyaw, K., Treepongkaruna, S., & Jiraporn, P. (2022). Board gender diversity and environmental emissions. Business Strategy and the Environment, 31(7), 2871-2881. https://doi.org/10.1002/bse.3052
https://doi.org/10.1002/bse.3052
Komal, B., Ye, C., & Salem, R. (2022). The impact of audit committee effectiveness on firms' outcomes in China: A systematic review. International Journal of Accounting & Information Management, 30(5), 583-599.
https://doi.org/10.1108/IJAIM-05-2022-0101
Lee, D. & Phua, L. (2022). Does audit committee moderate the relationship between auditor independence and earnings management during initial implementation of MFRS in Malaysia?. International Journal of Business and Society, 23(2), 751-772. https://doi.org/10.33736/ijbs.4836.2022
https://doi.org/10.33736/ijbs.4836.2022
Lenard, M. J., Yu, B., York, E., & Wu, S. (2014). Impact of board gender diversity on firm risk. Managerial Finance, 40(8), 787-803. https://doi.org/10.1108/mf-06-2013-0164
https://doi.org/10.1108/MF-06-2013-0164
Leung, T. Y. and Sane, A. (2022). Diversity as an innovative means to improve corporate governance: A new perspective. Journal of Indian Business Research, 15(1), 141-156. https://doi.org/10.1108/jibr-03-2022-0083
https://doi.org/10.1108/JIBR-03-2022-0083
Manita, R., Bruna, M. G., Đặng, R., & Houanti, L. (2018). Board gender diversity and ESG disclosure: Evidence from the USA. Journal of Applied Accounting Research, 19(2), 206-224. https://doi.org/10.1108/jaar-01-2017-0024
https://doi.org/10.1108/JAAR-01-2017-0024
Maroun, W. (2022). Corporate governance and the use of external assurance for integrated reports. Corporate Governance: An International Review, 30(5), 584-607. https://doi.org/10.1111/corg.12430
https://doi.org/10.1111/corg.12430
Marx, B. & Voogt, T. (2010). Audit committee responsibilities vis‐á‐vis internal audit: How well do Top 40 FTSE/JSElisted companies shape up?. Meditari Accountancy Research, 18(1), 17-32. https://doi.org/10.1108/10222529201000002
https://doi.org/10.1108/10222529201000002
Mohamad Ariff, A., Kamarudin, K.A., Musa, A.Z. & Mohamad, N.A. (2024). Financial constraints, corporate tax avoidance and environmental, social and governance performance. Corporate Governance, 24(7), 1525-1546. https://doi.org/10.1108/CG-08-2023-0343
https://doi.org/10.1108/CG-08-2023-0343
Mohammadi, P., Asnaashari, H., Safarzadeh, M., & Raad, A. (2025). Influence of audit committee effectiveness on financial reporting complexity. Journal of Management Accounting and Auditing Knowledge, 14(54), 165-186.
Mustafa, A. S., Che-Ahmad, A., & Chandren, S. (2018). Board diversity, audit committee characteristics and audit quality: The moderating role of control-ownership wedge. Business and Economic Horizons, 14(3), 587-614.
https://doi.org/10.15208/beh.2018.42
Narullia, D., Putri, D.M., Prastyaji, Y.T., & Fadhilah, N. (2024). Connection between the audit characteristics and corporate ESG performance in Indonesia. Journal of Economics, Finance and Management Studies, 7(1), 1-5. https://doi.org/10.47191/jefms/v7-i1-01
https://doi.org/10.47191/jefms/v7-i1-01
Nicolò, G., Zampone, G., Sannino, G., & Iorio, S. D. (2021). Sustainable corporate governance and non-financial disclosure in Europe: Does the gender diversity matter? Journal of Applied Accounting Research, 23(1), 227-249. https://doi.org/10.1108/jaar-04-2021-0100
https://doi.org/10.1108/JAAR-04-2021-0100
Ojeka, S., Adeboye, A., & Dahunsi, O. (2021). Does audit committee characteristics promote risk management practices in Nigerian listed firms?. Accounting and Finance Research, 10(2), 70. https://doi.org/10.5430/afr.v10n2p70
https://doi.org/10.5430/afr.v10n2p70
O'Shaughnessy, D., Sahyoun, N., & Tervo, W. (2022). Audit committee voluntary disclosure describing external auditor oversight: Does it reflect higher audit quality?. Journal of Corporate Accounting & Finance, 33(4), 22-38. https://doi.org/10.1002/jcaf.22560
https://doi.org/10.1002/jcaf.22560
Popov, K. & Makeeva, E. (2022). Relationship between board characteristics, ESG and corporate performance: A systematic review. Journal of Corporate Finance Research, 16(4), 5-20. https://doi.org/10.17323/j.jcfr.2073-0438.16.4.2022.5-20
https://doi.org/10.17323/j.jcfr.2073-0438.16.4.2022.5-20
Rajani, B. D. (2024). The role of ESG disclosure practices in investment decisions. EPRA International Journal of Environmental Economics, Commerce and Educational Management, 30-37. https://doi.org/10.36713/epra15522
https://doi.org/10.36713/epra15522
Raimo, N., Vitolla, F., Marrone, A., & Rubino, M. (2020). Do audit committee attributes influence integrated reporting quality? An agency theory viewpoint. Business Strategy and Environment, 30, 522-534. https://doi.org/10.1002/bse.2635
https://doi.org/10.1002/bse.2635
Rhee, C. S., Woo, S., & Rhee, H. (2022). Effect of gender diversity on corporate soundness and social contribution. Corporate Social Responsibility and Environmental Management, 30(1), 419-430. https://doi.org/10.1002/csr.2363
https://doi.org/10.1002/csr.2363
Sandberg, H., Alnoor, A., & Tiberius, V. (2022). Environmental, social, and governance ratings and financial performance: Evidence from the European food industry. Business Strategy and the Environment, 32(4), 2471-2489. https://doi.org/10.1002/bse.3259
https://doi.org/10.1002/bse.3259
Setiani, E. (2023). The impact of ESG scores on corporate financial performance: Moderating role of gender diversity. Nominal Barometer Riset Akuntansi Dan Manajemen, 12(1), 128-139. https://doi.org/10.21831/nominal.v12i1.59778
https://doi.org/10.21831/nominal.v12i1.59778
Shakil, M., Tasnia, M., & Mostafiz, I. (2020). Board gender diversity and environmental, social and governance performance of US banks: Moderating role of environmental, social and corporate governance controversies. The International Journal of Bank Marketing, 39(4), 661-677. https://doi.org/10.1108/ijbm-04-2020-0210
https://doi.org/10.1108/IJBM-04-2020-0210
Shakil, M.S. (2021). Environmental, social and governance performance and financial risk: Moderating role of ESG controversies and board gender diversity. Resources Policy. 72. 1-10. https://doi.org/10.1016/j.resourpol.2021.102144
https://doi.org/10.1016/j.resourpol.2021.102144
Siagian, F. T., & Tresnaningsih, E. (2011). The impact of independent directors and independent audit committees on earnings quality reported by Indonesian firms. Asian Review of Accounting, 19(3), 192-207. https://doi:10.1108/13217341111185128
https://doi.org/10.1108/13217341111185128
Stiadi, D. (2023). Moderating environmental, social, and governance risk in the relationship between investment decisions and firm value. Iop Conference Series Earth and Environmental Science, 1177(1), 012007. https://doi.org/10.1088/1755-1315/1177/1/012007
https://doi.org/10.1088/1755-1315/1177/1/012007
Tanjung, M. (2023). Cost of capital and firm performance of ESG companies: what can we infer from Covid-19 pandemic? Sustainability Accounting, Management and Policy Journal, 14(6), 1242-1267. https://doi.org/10.1108/sampj-07-2022-0396
https://doi.org/10.1108/SAMPJ-07-2022-0396
Toh & Pascual (2022). How companies can link ESG to long-term value. Available at https://www.ey.com/en_my/real-world-strategy/how-companies-can-link-esg-to-long-term-value
Tushabe, M., Kyambade, M., Kalisa, G., & Birungi, F. (2023). Work-life balance, gender role beliefs, gender participation and women's representation in leadership positions in public universities: A case of Makerere university. Asian Research Journal of Arts & Social Sciences, 21(4), 9-21. https://doi.org/10.9734/arjass/2023/v21i4488
https://doi.org/10.9734/arjass/2023/v21i4488
Velte, P. (2022). Does sustainable board governance drive corporate social responsibility? A structured literature review on European archival research. Journal of Global Responsibility, 14(1), 46-88. https://doi.org/10.1108/jgr-05-2022-0044
https://doi.org/10.1108/JGR-05-2022-0044
Wan Ismail, W.A., Kamarudin, K.A., Ariff, A.M., & Wan Hussin, W.N. (2023). Women on board, strength of auditing and reporting standards, and analysts' forecasts accuracy. Journal of Applied Accounting Research, 24(2), 380-402.
https://doi.org/10.1108/JAAR-02-2022-0029
Wasiuzzaman, S. & Mohammad, W. M. W. (2019). Board gender diversity and transparency of environmental, social and governance disclosure: Evidence from Malaysia. Managerial and Decision Economics, 41(1), 145-156. https://doi.org/10.1002/mde.3099
https://doi.org/10.1002/mde.3099
Weickgenannt, A., Hermanson, D., & Sharma, V. (2021). How U.S. audit committees oversee internal control over financial reporting. International Journal of Auditing, 25(1), 233-248. https://doi.org/10.1111/ijau.12218
https://doi.org/10.1111/ijau.12218
Wray, B., Veidis, E., Flores, E. C., Phillips, A. A., Alani, O., & Barry, M. (2023). A call to action for gender equity in climate leadership. The American Journal of Tropical Medicine and Hygiene, 108(6), 1088-1092. https://doi.org/10.4269/ajtmh.22-0674
https://doi.org/10.4269/ajtmh.22-0674
Wu, J., Feehily, R., & Lord, B. (2021). The corporate governance role of audit committees: Through the lenses of New Zealand institutional investors. Australian Accounting Review, 32(1), 63-76. https://doi.org/10.1111/auar.12338
https://doi.org/10.1111/auar.12338
Yahaya, P. D. O. A. (2025). Sustainability reporting quality in the face of the board of directors. Journal of Sustainability Accounting and Management Education, 11(1), 2040-8021 https://doi.org/10.20408/jsame.v11i1.59
https://doi.org/10.2139/ssrn.5094168
Young, S., Farquharson, K., De Silva, D., & Mather, P. (2024). The Challenges of Gender Diversity in Boards of Directors: An Australian Study with Global Implications. Global Challenges, 2400259. https://doi.org/10.1002/gch2.202400259
https://doi.org/10.1002/gch2.202400259
Zaman, R., Farooq, M., Khalid, F., & Mahmood, Z. (2021). Examining the extent of and determinants for sustainability assurance quality: The role of audit committees. Business Strategy and the Environment, 30(7), 2887-2906. https://doi.org/10.1002/bse.2777
https://doi.org/10.1002/bse.2777
Zhang, D., Wang, C., & Dong, Y. (2022). How does firm ESG performance impact financial constraints? An experimental exploration of the Covid-19 pandemic. European Journal of Development Research, 35(1), 219-239. https://doi.org/10.1057/s41287-021-00499-6
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 UNIMAS Publisher
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
Copyright Transfer Statement for Journal
1) In signing this statement, the author(s) grant UNIMAS Publisher an exclusive license to publish their original research papers. The author(s) also grant UNIMAS Publisher permission to reproduce, recreate, translate, extract or summarize, and to distribute and display in any forms, formats, and media. The author(s) can reuse their papers in their future printed work without first requiring permission from UNIMAS Publisher, provided that the author(s) acknowledge and reference publication in the Journal.
2) For open access articles, the author(s) agree that their articles published under UNIMAS Publisher are distributed under the terms of the CC-BY-NC-SA (Creative Commons Attribution-Non Commercial-Share Alike 4.0 International License) which permits unrestricted use, distribution, and reproduction in any medium, for non-commercial purposes, provided the original work of the author(s) is properly cited.
3) For subscription articles, the author(s) agree that UNIMAS Publisher holds copyright, or an exclusive license to publish. Readers or users may view, download, print, and copy the content, for academic purposes, subject to the following conditions of use: (a) any reuse of materials is subject to permission from UNIMAS Publisher; (b) archived materials may only be used for academic research; (c) archived materials may not be used for commercial purposes, which include but not limited to monetary compensation by means of sale, resale, license, transfer of copyright, loan, etc.; and (d) archived materials may not be re-published in any part, either in print or online.
4) The author(s) is/are responsible to ensure his or her or their submitted work is original and does not infringe any existing copyright, trademark, patent, statutory right, or propriety right of others. Corresponding author(s) has (have) obtained permission from all co-authors prior to submission to the journal. Upon submission of the manuscript, the author(s) agree that no similar work has been or will be submitted or published elsewhere in any language. If submitted manuscript includes materials from others, the authors have obtained the permission from the copyright owners.
5) In signing this statement, the author(s) declare(s) that the researches in which they have conducted are in compliance with the current laws of the respective country and UNIMAS Journal Publication Ethics Policy. Any experimentation or research involving human or the use of animal samples must obtain approval from Human or Animal Ethics Committee in their respective institutions. The author(s) agree and understand that UNIMAS Publisher is not responsible for any compensational claims or failure caused by the author(s) in fulfilling the above-mentioned requirements. The author(s) must accept the responsibility for releasing their materials upon request by Chief Editor or UNIMAS Publisher.
6) The author(s) should have participated sufficiently in the work and ensured the appropriateness of the content of the article. The author(s) should also agree that he or she has no commercial attachments (e.g. patent or license arrangement, equity interest, consultancies, etc.) that might pose any conflict of interest with the submitted manuscript. The author(s) also agree to make any relevant materials and data available upon request by the editor or UNIMAS Publisher.
