Title: Do female directors influence the relationship between environmental, social and governance scores and firm market value in emerging economies?

Authors: Rahul Matta; Himanshu Seth

Addresses: Indian Institute of Management, Management City, NH-10, Southern Bypass, Sunaria, Rohtak – 124010, Haryana, India ' Indian Institute of Management, Management City, NH-10, Southern Bypass, Sunaria, Rohtak – 124010, Haryana, India

Abstract: This study explores the impact of female directors (FD) on board on the relationship between environmental, social and governance score (ESGS) and the firm's market value (FMV) in developing markets such as India. Using the panel data regression approach on the sample of 253 public listed firms from India from 2016 to 2021, the association between the ESGS of Indian firms and their market value was investigated and scrutinising the effect of females on board on this relationship. Further, the dynamic GMM method was used to strengthen the conclusions and combat endogeneity bias. The results show that the FD on board do not affect the relationship between the combined ESGS, environmental and governance score and firm market value. However, the findings also show that the FD positively and significantly influences the relationship between the social score and firm market value. Further, this study suggests practical implications and future research directions.

Keywords: ESG scores; market value; female directors; corporate governance; firm's market value; FMV.

DOI: 10.1504/IJCG.2025.144255

International Journal of Corporate Governance, 2025 Vol.15 No.1, pp.46 - 74

Received: 17 Jan 2024
Accepted: 02 Dec 2024
Published online: 03 Feb 2025 *