IDEAS home Printed from https://ideas.repec.org/a/rnd/arimbr/v17y2025i3p43-56.html

Does Board Gender Diversity and Independent Drive Affect Corporate Sustainability Performance? Evidence from Malaysia

Author

Listed:
  • RAJA ADZRIN RAJA AHMAD
  • NURUL AZLIN AZMI
  • NORBALKISH ZAKARIA

Abstract

The underrepresentation of women on corporate boards remains a global concern. Malaysia has taken steps to address this issue through the Malaysian Code of Corporate Governance (MCCG 2021), which recommends a minimum of 30% female directors on boards. However, as of April 2025, the percentage of women directors in Bursa Malaysia stood at only 28% across all PLCs, indicating a gap between policy recommendations and actual implementation. This study examines the impact of board gender diversity and independence on corporate sustainability performance (CSP), proxied by the total ESG score. Using data from Refinitiv Eikon, the study covers 1,028 firms listed on Bursa Malaysia's main and ACE markets between 2019 and 2024, resulting in 6,168 firm-year observations. After excluding firms with insufficient ESG data, the final sample comprises 936 firm-year observations. A fixed-effects model was employed to analyse the unbalanced panel data. The results reveal that board gender diversity and board independence significantly enhance CSP. Additionally, board independence strengthens the positive relationship between board gender diversity and CSP, demonstrating its moderating effect. Robustness checks confirm that board gender diversity similarly influences both the environmental and social pillars. The findings provide empirical evidence supporting the role of board gender diversity and independence in promoting corporate sustainability. These insights have practical implications for investors and policymakers, emphasising the need to prioritise gender-diverse board compositions as Asian markets increasingly focus on corporate governance reforms.

Suggested Citation

  • Raja Adzrin Raja Ahmad & Nurul Azlin Azmi & Norbalkish Zakaria, 2025. "Does Board Gender Diversity and Independent Drive Affect Corporate Sustainability Performance? Evidence from Malaysia," Information Management and Business Review, AMH International, vol. 17(3), pages 43-56.
    • Handle: RePEc:rnd:arimbr:v:17:y:2025:i:3:p:43-56
    DOI: 10.22610/imbr.v17i3(I)S.4641
    as

    Download full text from publisher

    File URL: https://ojs.amhinternational.com/index.php/imbr/article/view/4641/3133
    Download Restriction: no
    File URL: https://ojs.amhinternational.com/index.php/imbr/article/view/4641
    Download Restriction: no
    File URL: https://libkey.io/10.22610/imbr.v17i3(I)S.4641?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Priti Yadav & Anshul Jain, 2023. "Sustainability disclosures and corporate boards: a stakeholder approach to decision-making," Journal of Applied Accounting Research, Emerald Group Publishing Limited, vol. 24(5), pages 1027-1047, April.
    2. Mariasole Bannò & Emilia Filippi & Sandro Trento, 2023. "Women in top echelon positions and their effects on sustainability: a review, synthesis and future research agenda," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 27(1), pages 181-251, March.
    3. Shaista Wasiuzzaman & Wan Masliza Wan Mohammad, 2020. "Board gender diversity and transparency of environmental, social and governance disclosure: Evidence from Malaysia," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(1), pages 145-156, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yakira Fernández-Torres & Clara Gallego-Sosa & Milagros Gutiérrez-Fernández, 2025. "Do women board members contribute to companies’ superior environmental performance? A literature review," Review of Managerial Science, Springer, vol. 19(5), pages 1513-1565, May.
    2. Buchetti, Bruno & Arduino, Francesca Romana & Perdichizzi, Salvatore, 2025. "A literature review on corporate governance and ESG research: Emerging trends and future directions," International Review of Financial Analysis, Elsevier, vol. 97(C).
    3. Alfredo Grau‐Grau & Manuel Branco & Inmaculada Bel‐Oms, 2025. "Board Characteristics and Stakeholder Engagement and ESG Performance: The Relevance of European Gender Parity," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 32(3), pages 3193-3209, May.
    4. Hadiqa Ahmad & Muhammad Yaqub & Seung Hwan Lee, 2024. "Environmental-, social-, and governance-related factors for business investment and sustainability: a scientometric review of global trends," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(2), pages 2965-2987, February.
    5. Mehmood, Asad & De Luca, Francesco & Quach, Hao, 2023. "Investigating how board gender diversity affects environmental, social and governance performance: Evidence from the utilities sector," Utilities Policy, Elsevier, vol. 83(C).
    6. Shakil, Mohammad Hassan, 2021. "Environmental, social and governance performance and financial risk: Moderating role of ESG controversies and board gender diversity," Resources Policy, Elsevier, vol. 72(C).
    7. Dang, Rey & Houanti, L'Hocine & Sahut, Jean-Michel & Simioni, Michel, 2021. "Do women on corporate boards influence corporate social performance? A control function approach," Finance Research Letters, Elsevier, vol. 39(C).
    8. Mariasole Bannò & Emilia Filippi, 2024. "Women in top echelon positions and firm internationalisation strategies: What do we know? How do we know? Where should we be heading?," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 28(4), pages 1257-1302, December.
    9. Mohamed Samy El-Deeb & Lana Mohamed, 2024. "The moderating role of board gender diversity on the association between audit committee attributes and integrated reporting quality," Future Business Journal, Springer, vol. 10(1), pages 1-23, December.
    10. Akshita Arora & Ranjit Tiwari, 2024. "Using gender diversity to improve intellectual capital performance: an Indian investigation," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 21(2), pages 252-267, June.
    11. Khosroshahi, Hossein & Dimitrov, Stanko & Hejazi, Seyed Reza, 2021. "Pricing, greening, and transparency decisions considering the impact of government subsidies and CSR behavior in supply chain decisions," Journal of Retailing and Consumer Services, Elsevier, vol. 60(C).
    12. Salma Loulou-Baklouti, 2024. "Does board gender diversity affect intellectual capital voluntary disclosure? Evidence from Tunisia," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 21(2), pages 193-210, June.
    13. Marco Traversi & Mariasole Bannò & Emilia Filippi, 2024. "The role of the cultural context in moderating the effect between the presence of women directors and firm environmental innovation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(5), pages 3685-3702, September.
    14. Christianna Chimonaki & Stelios Papadakis & Christos Lemonakis, 2024. "Environmental, Social, Governance and Gen-der Diversity Under the Adoption of European Directive 2014/95/EU," Accounting and Management Information Systems, Faculty of Accounting and Management Information Systems, The Bucharest University of Economic Studies, vol. 23(1), pages 162-188, January.
    15. Iram Hasan & Shveta Singh & Smita Kashiramka, 2025. "Does Socially Responsible Investing Outperform Conventional Investing? A Cross-Country Perspective," Asia-Pacific Financial Markets, Springer;Japanese Association of Financial Economics and Engineering, vol. 32(4), pages 1307-1356, December.
    16. Bruna, Maria Giuseppina & Đặng, Rey & Ammari, Aymen & Houanti, L'Hocine, 2021. "The effect of board gender diversity on corporate social performance: An instrumental variable quantile regression approach," Finance Research Letters, Elsevier, vol. 40(C).
    17. repec:ami:journl:v:24:y:2024:i:1:p:173-202 is not listed on IDEAS
    18. Ping Hu & Md Faysal Mia & Xueyan Feng & Miraj Ahmed Bhuiyan, 2025. "Understanding the barriers and catalysts for women entrepreneurship in the SME sector: a comparative study across the N-11 and G-7 countries," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 15(1), pages 1-18, December.
    19. Arduino, Francesca Romana & Buchetti, Bruno & Harasheh, Murad, 2024. "The veil of secrecy: Family firms’ approach to ESG transparency and the role of institutional investors," Finance Research Letters, Elsevier, vol. 62(PB).
    20. Yaseen AlJanadi, 2026. "Gender diversity and disclosure: a meta-analysis," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 23(1), pages 197-211, March.
    21. Đặng, Rey & Karmani, Majdi & Houanti, L'Hocine & Simioni, Michel & Abid, Ilyes, 2023. "Board gender diversity and environmental performance: A semi-parametric panel data analysis," Finance Research Letters, Elsevier, vol. 58(PA).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rnd:arimbr:v:17:y:2025:i:3:p:43-56. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Muhammad Tayyab (email available below). General contact details of provider: https://ojs.amhinternational.com/index.php/imbr .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.