Bangor University: Firms With Greater Gender Diversity In The Workplace Reduce CO2

Climate change poses a major risk to the global economy, policymakers have been addressing the threats and risks that could evolve from climate change, including addressing company organisational structure to assess whether it can have an affect.

The relationship between gender diversity in the workplace and a firm’s carbon emissions was the basis for research recently carried out by Bangor University, Bank for International Settlements (BIS) and the European Central Bank (ECB) which established whether females covering managerial positions improve a company’s environmental performance.

While board of directors’ decisions shape a firm’s strategy towards environmental instances, in reality it is managers that select the suitable strategy to meet a firm’s objectives.

The relationship between the percentage of women appointed as managers and firm carbon emissions was analysed from a sample of 1,951 listed companies in 24 industrialised economies over the period 2009-2019, a 1pp increase in female managers leads to a 0.5% decrease in CO2 emissions.

The results between the percentage of female managers and CO2 emissions are supported by a solid theoretical framework grounded on the pro-environmental traits of female personalities which influences their decisions regarding environmental in relation to implementing a board’s strategy.

It was encouraging to see that company policies that mandated the presence of women at management level not only had the right impact on gender diversity unbalances but also potentially contributes towards the environmental objectives.

Encouraging firms to foster the inclusion of female managers and include green values among recruiting profile criteria is a step in the right direction.

Yener Altunbas ,
Professor in Banking at Bangor University
It was proven that after the Paris Agreement, firms with greater gender diversity in the workplace reduced CO2 by about 5% more than firms more male-oriented.

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