Shaping a sustainable future: The impact of board gender diversity on clean energy use and the moderating role of environmental, social and governance controversies

This study investigates how gender-diverse boards are related to the adoption of clean energy and examines whether environmental, social, and governance (ESG) controversies have an impact on this link. The study analyzes 2395 firm-year observations from 13 European countries from 2006 to 2021. Drawing on the gender socialization theory and diversity theory, the research reveals a favorable effect of board gender diversity on a company's utilization of clean energy. It also demonstrates that ESG controversies play a significant role in moderating this relationship. Furthermore, the study affirms the critical mass theory by indicating that companies with at least three female board members exhibit a greater use of clean energy. The findings are robust to various methods, such as controlling for endogeneity problems, propensity score matching, sub-sample analysis, and alternative econometric models. This study's implications are important for stakeholders, policymakers, and managers. It suggests that having a gender-diverse board can increase the adoption of clean energy, benefiting a company's reputation and attractiveness to stakeholders. Policymakers can use these findings to design policies that encourage gender diversity on boards and achieve environmental goals, while managers can make informed decisions about board composition and clean energy adoption.