Researchers: Companies with Female CEOs are More Environmentally Friendly

Published on: 07 October 2022
by KnowESG
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According to researchers at Northwestern Polytechnical University's School of Management in Xi'an, China, companies run by women make more environmentally friendly decisions.

According to a study of 351 Chinese publicly traded companies in highly polluting industries from 2006 to 2019 published recently in Corporate Social Responsibility and Environmental Management, companies with female leaders tend to have "greater concern for stakeholders and social reflection," leading to policy decisions that favour reducing emissions of waste gas, wastewater, waste residues, and greenhouse gases.

According to authors Ying Zhang, Yuting Guo, and Aiman Nurdazym, the power of female corporate environmental policy leaders should not be underestimated.

"When women enter management, such traits will lead them to favour altruistic and ethics-related strategies, which are reflected in a greater concern for stakeholders and social reflection," the authors said.

“Unsustainable corporate environmental policies can damage relationships with stakeholders and hinder the development or maintenance of long-term relationships with communities,” they added.

It might behove board directors to promote women to executive positions to improve their corporate sustainability policies, the authors suggested. Admittedly, they said, their research had limitations.

“Although we propose that female CEOs are positively associated with corporate sustainable environmental policies, data limitations have prevented us from directly measuring the underlying mechanisms,” they said. “Future studies can further strengthen our arguments and empirical tests by conducting surveys and experiments to explore and measure this underlying mechanism or by finding better boundary conditions.”

Source: McKnights Senior Living

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