This study examines how board gender diversity and country-level environment, social and governance (ESG) reporting mandates influence firms’ ESG performance. Using an unbalanced panel of 52,159 firm-year observations from 55 countries between 2010 and 2023, the analysis combines baseline regressions with a lead-lag model, seemingly unrelated regressions (SUR), and staggered event-study estimates. The results show that gender-diverse boards are associated with higher ESG scores, with the strongest effects in the governance pillar. Mandatory ESG reporting raises environmental and social performance, while its effect on governance remains weaker. The interaction term indicates a negative substitution pattern, in which the marginal contribution of gender diversity declines under mandatory reporting regimes. SUR tests reveal systematic differences across ESG pillars, with governance responding more to board structure, while environmental and social outcomes respond more to regulations. Event-study estimates show that improvements appear several years after implementation, with no evidence of pre-trends or immediate post-adoption effects. These findings have implications for regulators designing ESG disclosure mandates and firms aiming to strengthen sustainability outcomes through board structures.
Ismail et al. (Wed,) studied this question.