Boards of directors and firms’ environmental proactivity

Abstract

The present paper advances knowledge on the antecedents of firms’ environmental proactivity, assessing the explanatory power of corporate governance issues. In particular, our aim is to explore the relationship between board structure and firms’ proactive environmental strategies, within the agency theory and resource dependence theory frameworks, in order to outline if particular types of board members could represent a stimulating driver for firms’ environmental proactivity. The theoretical analysis is completed by an empirical investigation, performed by two linear regression models, on a sample of European firms, belonging to different polluting industries that were included in the Carbon Disclosure Project questionnaire 2014. The industry choice is related to the increasing pressure for better environmental performance that polluting industries are nowadays experiencing because of stakeholders and legislation requests. The results show that board structure and composition matters in firms’ environmental proactivity and have implications for managers, shareholders, and regulators who are interested in influencing firms’ environmental proactivity.