Women in top echelon positions and their effects on sustainability: a review, synthesis and future research agenda

As Fig. 2 shows, literature on sustainability has grown exponentially since 2010.

The list of journals that published at least two of the selected publications is reported in Table 1. Corporate Social Responsibility and Environmental Management, Sustainability, and Business Strategy and the Environment published the most studies (31, 22, and 19, respectively), indicating a concentration in these three journals of 38% of the selected publications. Instead, there are 55 journals with only one selected publication each on gender and sustainability.

160 studies analyse the role of female directors (e.g. Guping et al., 2020; Pucheta-Martinez and Gallego-Alvarez, 2019; Rao & Tilt, 2016a); 24 examine the presence of female managers (e.g. J. Graafland, 2020; Lu et al., 2020a, 2020b); 13 consider the role of female CEOs (e.g. Criado-Gomis et al., 2020; Kabongo et al., 2013; Przychodzen et al., 2018); instead only two studies focus on women in the audit committee (i.e. Appuhami & Tashakor, 2017; Bravo & Reguera-Alvarado, 2018) while only one on women in the CSR committee (Elmaghrabi, 2021).⁵ Therefore, it emerges the greater attention paid to the role of female directors, which may be linked to the ease with which the data necessary for analysis can be obtained.

Several theories have been used in the field, however our literature review reveals seven main theoretical approaches that guided past research, based on the management literature. As can be seen from Table 2, the most common theoretical perspectives utilized in the literature are: Stakeholder theory (66 studies), Agency theory (53 studies), Resource dependence theory (37 studies), Legitimacy theory (24 studies), Upper echelons theory (24 studies), Critical mass theory (17 studies), Institutional theory (17 studies).

The gender-specific approaches include only two frameworks dedicated and originated as gender studies: the Critical mass theory (17 studies) and the Gender socialization theory (9 studies). What emerges is that most of the theories used in the selected publications to explain and frame gender issues are frameworks for explaining behavior based on values humans place on social group membership, but are not born and declined specifically for gender issues (i.e. social categorization theory, social identity theory, relational demography theory, self-construal theory). They all refer to social perception that can generate prejudice, which is then used as an explanation of gender issues. Theories that are not gender-specific are then the most employed. Finally, we also found theories that look at heterogeneity but are not born and declined specifically for gender issues (i.e. diversity theory and complexity theory). These are theoretical approaches that, unlike social frameworks, emphasize the positive aspects generated by diversity/heterogeneity.

All these theories, both gender specific and non specific ones, are applied regardless of the position of women.

In total, 51 different theoretical perspectives are explicitly employed on this topic. Finally, there are 34 studies that do not explicitly rely on any theory.

The reviewed studies are mainly based on quantitative methods, with the exception of two qualitative studies (Cuadrado-Ballesteros et al., 2017; Rao & Tilt, 2020) and two studies that adopted a mixed method approach (Dwekat et al., 2020; Mahmood et al., 2018). The empirical studies apply a wide range of regression methods including, among others: ordinary least squares, probit, logit, ordered, binomial, 2SLS, generalized method of moments, fixed effects regressions, and structural equation model. Of the 183 quantitative studies, the majority of studies use cross-sectional data, while some employ panel data or longitudinal design (e.g. Fahad & Rahman, 2020; Ramon-Llorens et al., 2021; Shahbaz et al., 2020; Uyar et al., 2020). This review highlights, therefore, a lack of conceptual and qualitative studies on the way the presence of women in firms affects sustainability.

Our review highlights that the subject of analysis is generally medium to large publicly listed firms (e.g. Arayssi et al., 2020; Kilincarslan et al., 2020; Rejeb, 2017; Zahid et al., 2020), with three exceptions that examined small and medium enterprises (i.e. Courrent et al., 2016; Graafland, 2020; Sancho et al., 2017). Fifty-five studies use multi country data (e.g. García‐Sánchez et al., 2020b; Valls Martínez et al., 2020), of which 9 studies focusing only on European contexts (e.g. Ben Fatma & Chouaibi, 2021; Gangi et al., 2021; Nuber & Velte, 2021). 132 studies analyse the data of only one country; the most considered countries are geographically distributed and include: United States (26 studies), China (15 studies), Australia (12 studies), Spain (11 studies), Malaysia (7 studies), United Kingdom (7 studies), France (7 studies), Bangladesh (6 studies), Pakistan (5 studies), Italy (5 studies), Canada (4 studies). This degree of internationality is perhaps not surprising given the fact that sustainability is crucially important in many economies around the world (Amorelli and García‐Sánchez, 2020a). However, there are a number of important regions where research in gender and sustainability is underrepresented in the journal literature, including Eastern Europe, Africa, Latin America, and Asia, despite the importance of these regions to understanding the role of female presence in different contexts (Khan et al., 2019a, 2019b).

Seventy-nine studies investigate the relationship between gender in top echelon positions and sustainable activities, of which 50 find a positive relationship, 4 a negative relationship, 14 mixed results and 11 no relationship. Almost all analysed studies examine the effects of the presence of women on sustainable activities by distinguishing according to their position.

Many studies reveal a positive relationship between the presence of female directors and sustainable activities (see e.g. Beji et al., 2020; Rehman et al., 2020; Saheed Olanrewaju et al., 2020). Female directors not only positively affect corporate sustainability, but they also play a key role in “enabling firms to ethically manage their social responsibilities and sustainable practices” (Yasser et al., 2017) and in promoting the adoption of equality, diversity and inclusion policies (Bruna et al., 2014). While having a positive effect on CSR, female directors also decrease corporate social irresponsibility (Boukattaya & Omri, 2021). Arayssi et al. (2016) state that the presence of female directors “favourably influences on a firm’s risk and performance through promoting a firm’s investment in effectual social engagements and reporting on them”. Female directors facilitate the use of the firm’s scarce resources towards social projects that maximize value (Jizi, 2017) and encourage the firm’s affiliation with the United Nations Global Compact (Martínez-Ferrero et al., 2020).⁶ The educational background, talent, and experience of female directors is important in the adoption of sustainable environmental initiatives (García Martín & Herrero, 2020): therefore the presence of talented women in the firm allows them to manage social responsibility and sustainable practices in an appropriate way (Setó-Pamies, 2015).

On the contrary, Loukil et al. (2019) state that “the presence of female independent directors reduces firm involvement in sustainable development projects”. Instead, some studies find that board gender diversity has no effect on sustainability (e.g. Ajaz et al., 2020; Ardito et al., 2020; Zaid et al., 2020). Finally, other studies find mixed results. For example, it results that female directors are beneficial for sustainability engagement only if they are not members of the controlling family, while they foster philanthropic engagement only if they are members of the controlling family (Campopiano et al., 2019). According to Cullinan et al. (2019), while female independent directors are positively associated with sustainability, this is not true for female executive directors.

While Yarram and Adapa (2021) observe that gender diversity positively influences total sustainability but not its individual components, other studies find that female directors influence both environmental and social sustainable activities.

Regarding environmental sustainability, many studies find that female directors are positively related to attitudes towards environmental protection (e.g. Cosma et al., 2021), the pursuit of environmentally friendly strategies (Glass et al., 2016), carbon reduction initiatives (Haque, 2017), corporate environmental investment (Hu & Yang, 2021), and a higher probability that the firm takes part in sustainability-themed alliances (Post et al., 2015).⁷ Environmental sustainability initiatives are positively influenced by gender diversity, in both demographic (i.e. the percentage of women on the BoD or in top management positions) and structural terms (i.e. firm policies and practices that enable or reinforce gender diversity) (Kassinis et al., 2016). According to Shoham et al. (2017), firms increase their involvement in environmental sustainability as soon as they appoint a woman to the BoD; however, this decision is strongly influenced by the culture of the countries in which the organization operates (Xie et al., 2020). Moreover, the likelihood of a firm to create pollution is moderated by the positive relationship between the presence of female directors and the environmental policy of the firm (Li et al., 2017). All these positive effects of female directors on environmental sustainability can explain the choice of majority family owners and dual-class owners to appoint female directors with the charge to advance “their personal preferences for environmental corporate social responsibility” (Cordeiro et al., 2020).

On the contrary, Galbreath (2011) highlights that despite the important role of women in sustainable activities, it could happen that due to sex-based biases and stereotyping, men directors ignore the suggestions from female directors on aspects regarding environmental quality with the consequence that female directors are not significantly associated with environmental quality. Wei et al. (2017) specify that when there are only one or two female directors on the board, no significant relationship on environmental investment can be seen; however, when the number of female directors reaches at least three, they have a significantly positive effect on it but only in state-owned firms and firms from heavily-polluting industries.

Moving to social activities, the presence of female directors (as well as in top and middle management) has a positive effect on sustainable activities with gender equality objectives (Larrieta-Rubín de Celis et al., 2015).

The effect of gender diverse boards on sustainability dimensions varies depending on the type of stakeholder: this diversity positively affects sustainability dimensions that are associated with stakeholders with less power (e.g. the environment, contractors, and the community), but it does not affect sustainability dimensions that are related to stakeholders with more institutionalized power (e.g. employees and customers) (Francoeur et al., 2019). In the interaction with various stakeholders, female directors are able to talk with them and to satisfy their needs, reducing the risk of their negative reactions, which can damage firm profits (Galbreath, 2011).

Finally, female participation on BoDs has an effect on specific aspects. Together with board independence, board gender composition affects sustainable supply chain responsibility through three channels: CEO duality, sustainability committee, and sensitive industries (Benjamin et al., 2019).

Focusing on female managers, conflicting results emerge. According to some studies, environmental and social commitments are greater for female managers (Buil-Fabrega et al., 2017). Female managers positively affect “corporate sustainable competitive advantage, which included both the inhibiting effect on unethical environmental behavior and the stimulating effect on proactive environmental strategies” (Pan et al., 2020). Moreover, compared to men, female managers tend to implement diversity and labor flexibility policies related to work schedule and flexible work as part of their sustainability (Arredondo Trapero et al., 2013). On the contrary, according to Q. Lu et al., (2020a, 2020b), the relationship between the presence of female top managers and sustainability is negative especially for firms in a market with a low marketization level. Instead, some studies find that the presence of women on the top management team does not affect sustainability practices (e.g. Prudêncio et al., 2021), both regarding sustainability as a whole or each of its dimensions (economic, social and environmental) (Martínez León et al., 2011). More in detail, Courrent et al. (2016) show how manager characteristics like gender, age, experience, and training do not influence a firm’s pursuit of social activities, while their personal values (measured using ethics and local territorial belonging) do influence these activities. For example, in the purchase of products, it seems that on average, purchasing managers are willing to pay a premium for products that are compliant with the United Nations Global Compact; this willingness is not affected by the gender of the purchasing managers (Goebel et al., 2018). Finally, mixed results were found by Wu et al. (2019), according to which while existing female executives or top managers stimulate corporate philanthropy (and this relationship is influenced by the firm controller and the degree of industry competition), they do not affect the scale of philanthropy.

Regarding female CEOs, Galbreath and Tisch (2020) find that women in the operations manager role foster environmentally sustainable practices, while women in the CEO role do not. However, when women are in both CEO and operations manager roles in the same firm, the relationship with environmentally sustainable practices is positive.

If we analyse the relationship between the presence of women and sustainable activities and strategies considering the role they play, it emerges that the literature is almost unanimous in stating that female directors have a positive effect on sustainable activities. Conversely, when analyzing the position as manager, the results are mixed, perhaps due to the small number of studies. One common finding from the analyses on the effect of women in the two positions (i.e. in BoD or top management team) is that the results are positively influenced by the demographic, educational, and cultural characteristics of the women (Courrent et al., 2016; Kassinis et al., 2016; Xie et al., 2020). Instead, too few studies are related to the CEO and other committee positions to draw conclusions.

Fifty studies investigate the relationship between women in top echelon positions and sustainability performance, of which 37 find a positive relationship, 2 a negative relationship, 7 mixed results and 4 no relationship. Of course, the environmental and social performance depends on various factors (Fig. 3). First of all, strategies regarding sustainability play a key role: “firms with more effective CSR strategies exhibit better environmental and social performance” (Orazalin & Baydauletov, 2020). However, sustainability performance also depends on both BoD characteristics (e.g. size, independency, diversity, and activity) and corporate characteristics (e.g. firm size, leverage, and growth opportunities), which, when properly combined, lead to high levels of social responsibility performance (Cuadrado-Ballesteros et al., 2017).

Biswas et al. (2018) confirm this result, finding that “firms with higher board gender composition, greater board independence and sustainability committees tend to have better social and environmental performance”. Furthermore, even board gender diversity alone positively affects the sustainability performance as confirmed by several studies (e.g. Chams and Garcia-Blandon, 2019; Govindan et al., 2021; Lu & Herremans, 2019; Romano et al., 2020; Uyar et al., 2021). The positive relationship between female directors and sustainability performance is higher when there are female chairs within the board CSR committee (Eberhardt-Toth, 2017) and when the firm has a consumer market orientation (Hyun et al., 2016) or operates in a male-dominated industry (Zaichkowsky, 2014) or has an environmental and social risk exposure (Naveed et al., 2021).

Other studies find opposite results. Specifically, Fakir and Jusoh (2020) and García‐Sánchez et al. (2020a) find no relationship between female directors and sustainability performance. Two studies demonstrate a return on investment in sustainable activities decreasing with the proportion of female directors (Bristy et al., 2020; Zhuang et al., 2018). Finally, mixed results are found by for example Alazzani et al. (2019) and Ardito et al. (2020). Zhang (2012) finds that while there is a positive relationship between board gender diversity and institutional strength and technical strength of sustainability, the relationship is not significant when considering the weakness ratings of sustainability performance.

Some studies consider the environmental and social performance achieved by firms. While these two aspects of sustainability are usually pursued together, it could happen that one aspect is more important than the other due to the influence of culture and institutional context. For example, the Malaysian culture drives firms to place more importance on the social performance strictly linked to human orientation than on other dimensions (e.g. economic, environmental and marketplace aspects) (Alazzani et al., 2017). Considering both the environmental and social performance, Shaukat et al. (2016) find that the board gender diversity enables a more proactive and comprehensive sustainability strategy, thus leading to a higher environmental and social performance. On the contrary, according to Reyes Bastidas and Briano-Turrent (2018) female directors (or CEOs) positively affect the economic dimension, but worsen the environmental and social dimensions.

Focusing on environmental performance, some studies find a positive relationship between female directors and environmental performance (e.g. Lopatta et al., 2020; Orazalin & Mahmood, 2021). As anticipated in the previous section, the participation in sustainability-themed alliances, associated with a high representation of women on the BoD, positively affect the corporate environmental performance (Post et al., 2015).⁸ Considering both sustainability strategy and environmental performance, Orazalin and Baydauletov (2020) find that the positive relationship between these two aspects is negatively affected by the board gender diversity. Finally, Nadeem et al. (2020) and Nguyen et al. (2021) find no relationship between female directors and environmental performance.

Considering the social performance, while according to Landry et al. (2016) female directors increases the probability of the firm to appear on lists measuring ethics or organizational quality (e.g. the Most Admired Companies, the Most Ethical Companies, the Best Companies to Work for, and the Best Corporate Citizens), according to Sanan (2016) there is no significant association between gender diversity of boards and social performance.

A greater gender balance in top-management increases sustainability performance (McGuinness et al., 2017). Female managers also positively affect the firm’s environmental performance with the “development of eco-friendly products and commitment to resource reduction” (Burkhardt et al., 2020). On the contrary, Lu et al. (2019) find that a U-shaped relationship between female managers and sustainability performance exists.

Regarding female CEOs, it was found that they positively affect sustainability performance (Huang, 2013). This positive effect is evident both in polluting and non-polluting firms, which are able to significantly reduce pollutant emissions (Jiang & Akbar, 2018).

If we analyse the effect of women on sustainability performance considering the role they play, it emerges how female directors lead to mixed results in this case. Specifically, the role of women in other committees emerges in this regard. On the other hand, if one analyses the position as manager, the results are mostly in agreement in detecting positive effects. Also in this case, there exist too few studies in relation to the position of CEO to draw considerations.

The presence of women in top echelon positions also has an effect on sustainability disclosure through “documents intended to inform all stakeholders of the economic, social and environmental impacts of corporate performance, with respect to a given period of time” (García-Sánchez et al., 2019). Seventy-seven studies investigate this relationship, of which 55 find a positive relationship, 5 a negative relationship, 8 mixed results and 9 no relationship.

The presence and number of female directors positively affects firm’s disclosure (e.g. Alia & Mardawi, 2021; Frias-Aceituno et al., 2013; Girón et al., 2020; Peng et al., 2021). Several aspects are positively affected: the level or extent of disclosure (e.g. Issa & Fang, 2019; Ong & Djajadikerta, 2018), its quality (e.g. Khan, Khan, & Senturk, 2019a, 2019b; Mahmood & Orazalin, 2017; Vitolla et al., 2020), its transparency (Garcia-Torea et al., 2017), its lower risk of impression management strategies (i.e. the risk that these reports are a “result of opportunistic behaviour, by which managers can disclose biased information”; García-Sánchez et al., 2019). Finally, female participation on BoDs is among the factors that predict the engagement of firms in the assurance regarding sustainability disclosure, which is recognized as a means to increase its reliability, and that affect the choice of the provider with a preference towards auditing professionists (Buertey, 2021; Liao et al., 2018). On the contrary, some studies state that the presence of female directors negatively influences sustainability disclosure (e.g. Cucari et al., 2018; Gallego-Alvarez and Pucheta-Martinez, 2020b) or does not have any effect on it (Giannarakis, 2014; Giannarakis et al., 2014; Yusoff et al., 2019). Finally, other studies find mixed results: according to Biswas et al. (2021) female directors who are affiliated to the governing family, founders and other board members reduce disclosure in family firms; instead, unaffiliated female directors enhance disclosure both in family and non-family firms.

According to critical mass theory (Dahlerup, 2006), the number of female directors that produces significant effects on firm’s disclosure is identified as at least three by for example Amorelli and García‐Sánchez (2020a) and De Masi et al. (2021). In this regard, Alazzani et al. (2017) suggest that the (insufficient) number of female directors considered in their analysis may have led to the conclusion that there is a “moderate relationship between board gender diversity and CSR disclosure”. Instead, according to Manita et al. (2018), even when the critical mass (three female directors) is reached, no significant relationship between board gender diversity and sustainability disclosure is found.

Regarding the quality of disclosure, García-Sánchez et al. (2019) state that female directors produce “more balanced, comparable and reliable information”, even if at the same time they are associated with “less precise and clear information, given their narrative character”; these effects are larger in more stakeholder-oriented countries. Al-Shaer and Zaman (2016) specify that when female directors are independent, the quality of sustainability reporting is amplified with respect to the presence of non-independent female directors. However, Amorelli and García‐Sánchez (2020a) highlight that the positive role of women on voluntary information disclosure does not remain when they become CEO: in fact, when they reach this position, female directors start to adopt a “a male stereotype regarding voluntary information disclosure”, regardless of the human capital of the directors.

Focusing on environmental disclosure, there is a positive relationship between the presence of female directors and environmental disclosure (Rao et al., 2012; Yusoff et al., 2016), including the likelihood of disclosing information regarding climate change (Ararat & Sayedy, 2019; Ben-Amar et al., 2017), carbon (Hossain et al., 2017), corporate greenhouse gas emissions (Hollindale et al., 2019; Tingbani et al., 2020).⁹ The board gender diversity is among the factors that determines the quality of environmental disclosure (Baalouch et al., 2019). On the contrary, according to Kılıç and Kuzey (2019), the presence of female directors is not associated with the carbon disclosure index and the decision of a firm to respond to the Carbon Disclosure Project. A similar result is found by Post et al. (2011), according to which reaching this critical mass does not affect the disclosed environmental corporate social responsibility.

Regarding the effect of female managers, Dilling and Caykoylu (2019) find a significant negative correlation between integrated report quality and the ratio of female executives.¹⁰

Gender diversity in the audit committee characteristics has a significant positive influence on the level of CSR disclosure and on the CSR environmental disclosure (Appuhami & Tashakor, 2017). It also increases the quality of voluntary sustainability reporting both in terms of comprehensiveness and relevance, as women may operate as monitoring mechanisms in the increasing commitment to provide valuable sustainability information and to display greater stakeholder orientation (Bravo and Reguera‐Alvarado, 2018).¹¹

If we analyse the role of women on sustainability disclosure considering the position they held, it emerges that the literature is almost unanimous in stating that female directors have a positive effect on sustainability disclosure albeit with due specification. This relationship is, in fact, the most analysed in the literature and, therefore, the most exhaustive and articulated in describing how the characteristics of the board enter into the relationship. The same considerations apply to the committees that in this case are more investigated. Therefore, a similar relationship emerges between women in the BoD and relevant committees and sustainability disclosure. Viceversa, if one considers the position as manager, the results are mixed, perhaps, once again, due to the small number of studies.

Only 15 studies analyse the relationship between the presence of women in top echelon positions (in which they moderate sustainable activities, performance, and disclosure) and the financial performance of the firm and its value. Of these studies, 9 find a positive relationship, 2 a negative relationship, 3 mixed results and one no relationship.¹² Among others, Chong et al. (2018) highlight the need of firms to “engage in sustainable development to maximise the firms’ value” and stress the essential role of women in defining the strategy regarding these activities.

Board gender diversity can increase firm value by promoting renewable energy consumption (Atif et al., 2021) or by promoting sustainability disclosure (Bektur & Arzova, 2020). In fact, sustainable activities will be appreciated by the stakeholders and lead to “more beneficial contracting and opening new avenues of growth” (Qureshi et al., 2020), which will be valued on the market and result in higher stock prices. In this mechanism, board gender diversity is extremely important, as firms with higher diversity tend to disclose more regarding sustainable activities, as exposed in the previous section. Furthermore, Arayssi et al. (2016) demonstrate that the presence of female directors “favorably influences on a firm’s risk and performance through promoting a firm’s investment in effectual social engagements and reporting on them”.

Contrasting results are reported in few studies. Ajaz et al. (2020) state that there is a negative relationship between board gender diversity, sustainability performance and a firm’s financial performance, while there is no significant relationship with the firm’s reputation. Bristy et al. (2020) demonstrate that the return on investment in sustainable activities decreases with the proportion of female directors.

In the case of managers, it has been found that gender diversity in top management teams increases the level of implementation of sustainability, with an effect on firm performance (Quintana-García et al., 2018).

Female CEOs and CFOs also have a positive effect on firm performance through the promotion of sustainability. The appointment of a chief executive in the area of sustainability can improve the financial performance, as the “company shows its commitment to sustainability and social responsibility to its stakeholders” and this positive image “may have signaling effects for its customers, employees, and shareholders” (Wiengarten et al., 2017). The greatest benefits can be obtained if this female executive has a background in functions related to sustainability (Wiengarten et al., 2017) and is an independent director rather than a male executive director (Atif et al., 2020).

Female CFOs also improve firm performance such as debt cost saving as they conduct more environmentally responsible activities, whose effects are more prominent in high risk firms (Wang et al., 2021).

It is difficult to analyse the effect of women in top echelon positions on firm performance and value considering the role they play, given the small number of studies. However, it seems to emerge that the effect tends to be positive regardless of position in the Bod, top management team, as CEO or in relevant committees.

Our discussion of the main methodological and theoretical findings on female presence in top echelon positions and sustainability allowed us to identify some important gaps that can be analysed in future research. A summary is offered in Table 4.

The framework used to reveal the emerging findings allowed the identification of some important topics that should be analysed in future research. A summary is offered in Table 4.