Next Article in Journal
Evaluation of the Effects of Land Cover Change on Ecosystem Service Values in the Upper Reaches of the Heihe River Basin, Northwestern China
Previous Article in Journal
Building an Industry-Oriented Business Sustainability Curriculum in Higher Education
Open AccessArticle

Composition and Activity of the Board of Directors: Impact on ESG Performance in the Banking System

1
Department of Management and Business Administration, “G. d’ Annunzio” University of Chieti-Pescara, 65127 Pescara, Italy
2
Department of Economics, University of Foggia, 71121 Foggia, Italy
3
Ionian Department of Law, Economics and Environment, University of Bari Aldo Moro, 74121 Taranto, Italy
4
Department of Economics, University of Salento, 73100 Lecce, Italy
5
Rimini Centre for Economic Analysis, 47921 Rimini, Italy
*
Author to whom correspondence should be addressed.
Sustainability 2018, 10(12), 4699; https://doi.org/10.3390/su10124699
Received: 10 November 2018 / Revised: 1 December 2018 / Accepted: 4 December 2018 / Published: 10 December 2018
A growing body of research suggests that the composition of a firm’s board of directors can influence its environmental, social and governance (ESG) performance. In the banking industry, ESG performance has not yet been explored to discover how a critical mass of women on the board of directors affects performance. This paper seeks to fill this gap in the literature by testing the impact of a critical mass of female directors on ESG performance. Other board characteristics are accounted for: independence, size, frequency of meetings and Corporate Social Responsibility (CSR) committee. We use fixed effects panel regression models on a sample of 108 listed banks in Europe and the United States for the period 2011–2016. Our main empirical evidence shows that the relationship between women on the board of directors and a bank’s ESG performance is an inverted U-shape. Therefore, the critical mass theory for banks is not supported, confirming that only gender-balanced boards positively impact a bank’s performance for sustainability. There is a positive link between ESG performance and board size or the presence of a CSR committee, while it is negative with the share of independent directors. With this work, we stress the key role of corporate governance principles in banks’ ESG performance, with relevant implications for both banks and supervisory authorities. View Full-Text
Keywords: ESG performance; board of directors; banks; corporate governance ESG performance; board of directors; banks; corporate governance
Show Figures

Figure 1

MDPI and ACS Style

Birindelli, G.; Dell’Atti, S.; Iannuzzi, A.P.; Savioli, M. Composition and Activity of the Board of Directors: Impact on ESG Performance in the Banking System. Sustainability 2018, 10, 4699.

Show more citation formats Show less citations formats
Note that from the first issue of 2016, MDPI journals use article numbers instead of page numbers. See further details here.

Article Access Map by Country/Region

1
Back to TopTop