The Impact of Women’s Empowerment on the Corporate Environmental, Social, and Governance (ESG) Disclosure

Abstract

This research article examines the relationship between women’s empowerment and corporate ESG disclosure variables by analyzing 10,121 publicly traded companies listed worldwide with historical ESG data available in Bloomberg from 2016 to 2020. The paper seeks to answer whether corporate gender diversity directly affects companies’ ESG disclosure by using proprietary Bloomberg ESG disclosure scores and independent variables such as the female board and executive representation. Control variables, like the company’s return on equity, total debt ratio, and the natural logarithm of total assets as a proxy measurement of the firm’s size, are also included. Results provide evidence that policies that foster corporate gender diversity directly benefit from enhanced ESG-related disclosure, thus helping to trigger national dialogues about suitable corporate gender diversity strategies influencing firms’ ESG disclosure. This paper makes a unique contribution to the literature by being the first to analyze the effects of women’s empowerment on ESG disclosure using a globally representative sample. The evidence of the benefits of women’s empowerment associated with corporate ESG disclosure suggests that organizations with a more gender-diverse corporate board and executive team are more likely to have higher levels of ESG disclosure, as gender diversity increases the likelihood of organizational transparency and accountability, and can lead to improved corporate value. Governments should use this evidence to implement policies promoting women’s empowerment in the corporate world, ultimately leading to improved corporate ESG disclosure.