Affiliation:
1. Sasin School of Management Chulalongkorn University Bangkok Thailand
2. UWA Business School The University of Western Australia Crawley WA Australia
3. NTNU Business School Norwegian University of Science and Technology Norway
4. Great Valley School of Graduate Professional Studies Pennsylvania State University Malvern United States
Abstract
AbstractWe show the influence the size of a corporate board has on firms' ESG controversies. Our analysis suggests that businesses with larger boards are more effective in mitigating ESG controversies. Specifically, a rise in board size by one standard deviation results in a decline in ESG controversies by 4.30%. Our findings corroborate the anticipation that businesses need the board's advice to prevent ESG controversies. Thus, larger boards, with more human capital and more interactions with stakeholders, promote sustainability more effectively. Moreover, we find that the effect of board size is less pronounced during a stressful time but is more evident in companies with more agency problems. Further analysis validates the findings, that is, propensity score matching, entropy balancing, an instrumental‐variable analysis, and GMM dynamic panel data analysis.
Funder
National Research Council of Thailand
Subject
Management, Monitoring, Policy and Law,Strategy and Management,Geography, Planning and Development,Business and International Management