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We examine the relationship between board demographic diversity, board structural diversity, board capital diversity and corporate carbon performance (CCP). Additionally, we investigate how corporate sustainable resource use mediates these relationships.

We utilize unbalanced panel data from Refinitiv Eikon covering 9,960 global firms from 2002 to 2022. We conduct a panel regression analysis to examine the relationship between board demographic diversity, board structural diversity, board capital diversity and CCP. In addition, we estimate entropy balancing estimation and two-step system GMM to address endogeneity issues.

The results indicate that board demographic diversity (including tenure, gender, and cultural diversity), structural diversity (such as board independence, board size, CEO-chairman duality, board meetings, and board compensation), and capital diversity (comprising board member affiliation and specific skills) all have a positive and significant association with corporate carbon performance. Additionally, our findings reveal that corporate sustainable resource use fully mediates the relationship between board demographic diversity and CCP and partially mediates the relationship between board structural diversity, board capital diversity, and CCP.

Our study findings are based on a diverse range of global firms, ensuring that the results address the global challenges of firm-level climate change response and governance issues.

Our group diversity constructs offer new insights into the literature and further advance research on board group diversity. Additionally, for the first time, we explore the mediating role of sustainable resource use through the resource-based view (RBV) between-group diversity attributes and corporate carbon performance.

Agency theory postulates that research and development (R&D) investments are subject to managerial discretion and thus may not enhance firm value as expected. The inconclusive empirical findings in the literature is a testament of that. This paper aims to investigate the interplay between board gender diversity (i.e. women on boards) and value relevance of firms’ effort to innovate as indicated by firms’ R&D investments.

Through a sample of 1,626 US-listed firms from the period 2004 to 2019, the authors examine whether board gender diversity promotes or hampers value relevance of firms’ efforts to innovate. The authors use ordinary least squares as the baseline model and address potential endogeneity through instrumental variable two-stage least square, and selection bias through Heckman selection model. Finally, the authors use the financial crisis of 2008 as a natural experiment to investigate the effect of board gender diversity during the crisis period.

The results show that board gender diversity positively moderates the relation between R&D and firm value. In times of financial crisis, R&D does not destroy firm value in firms with gender diverse board. The results are robust to measurement error, endogeneity issue, particularly simultaneity and selection bias.

The findings in this study have several practical implications. Firms that invest heavily in R&D should be mindful of gender diversity in their board recruitment strategies to enhance innovation outputs and firm value. Current and potential investors (i.e. shareholders) should take into consideration board gender diversity in their investment decision-making processes as the results show that gender diverse boards promote more effective governance, which, in turn, leads to better alignment of R&D investments with shareholder value. Regulators aiming to improve corporate governance policies should encourage gender diversity on the boards. The results align with global initiatives such as the United Nations Sustainable Development Goals, particularly Goal 5 on gender equality. Policymakers may use the findings in this study to advocate for more gender diverse governance structures within corporations.

This study investigates the role gender diverse boards play in creating value from firms’ R&D activities.