Do emerging and developed countries differ in terms of sustainable performance? Analysis of board, ownership and country-level factors

This paper aims to provide insights into the environmental, social and governance (ESG) performance of firms from emerging and developed countries relative to their control mechanisms and institutional framework. The main objective is to determine which of these board, ownership and country-level drivers exert the greatest explanatory power in ESG performance. In other words, this paper examines the behaviour of the board of directors, ownership and the effect of institutional pressure. Using a sample of 69 461 firm-year observations from 2012 to 2018, and following a two-stage analysis model, the results point to interesting findings for both blocks of countries. In emerging environments, the country effect prevails and the positive effect of the board of directors guarantees its efficiency, while in developed countries, the main mechanism affecting ESG performance is the board of directors, with the ownership effect also playing a key role.