Board gender diversity and ESG performance: The mediating role of temporal orientation in South Africa context

Prevailing research on the interaction between board gender diversity (BGD) and Environmental, Social, and Governance (ESG) performance presents equivocal findings, particularly in the context of developing countries. This study ventures into an exploratory examination of this association, situated in the socio-cultural milieu of South Africa, a region where the lower social status of women often leads to a bias towards short-term perspectives. Drawing on the role congruity theory of prejudice toward female leaders, this study aims to investigate the mediating role of short-term orientation (SHRT) in the BGD-ESG relationship. We further explore how the preference of female directors toward SHRT varies depending on their tenure on the board and across family and non-family firms. The empirical findings, drawn from an examination of publicly listed non-financial firms on the Johannesburg Stock Exchange (JSE) from 2015 to 2020, indicate a negative relationship between BGD and ESG, with SHRT predominantly mediating this association. Additionally, the tenure of female directors attenuates their preference for SHRT. Notably, we found the effect of BGD on SHRT is less pronounced in family firms, where the choices of female directors are more aligned with the family firm's long-term orientation. Our findings contribute to both theory and practice by advancing our understanding of the BGD-ESG relationship and providing practical implications for organizations, leaders, and policymakers.