Impacts of board characteristics on ESG performance in the industrial sector: A quantitative study with evidence from Scandinavia

Abstract

We examine the impacts of board characteristics like board size, board independence, board gender diversity, and audit committee expertise on the environmental, social and governance (ESG) performamces of industrial companies in the four Scandinavian countries. The data on board characteristics and reported ESG scores is retrieved from the LSEG Eikon database. The sample comprises data for 150 industrial companies from Denmark, Finland, Sweden and Norway over the time period 2019-2022. Results for fixed-effects panel data regressions show that board gender diversity and board independence have a positive and significant relationships with ESG performance, while we did not find any significant effects of board size and audit committee expertise on ESG performance.