ABSTRACT Water pollution poses a significant challenge in the developing world, demanding immediate action to protect water resources. This study examines the impact of female directors on firms' environmental initiatives in wastewater treatment and boundary conditions that influence female directors' attention, utilizing a unique Chinese database. Analyzing plant‐level data on wastewater yield and treatment, we find that a higher proportion of female directors is associated with increased wastewater treatment efforts. Moreover, by drawing on the attention‐based view to examine boundary conditions, we find a stronger positive effect of the proportion of female directors on wastewater treatment in family firms, firms with board political background, and firms with higher long‐term institutional ownership. Our results contribute to the literature on firms' sustainable initiatives, emphasizing the importance of female directors' attention to environmental issues, and shed light on firms' internal and external factors that enhance female directors' allocation of attention to environmental initiatives.
Thosuwanchot et al. (Mon,) studied this question.