Unraveling asymmetric connectedness: Board diversity, green energy and climate change combat: An asymmetry in economic dynamics

Abstract

This paper examines the role of Board Diversity in advancing environmental stewardship, with a particular emphasis on climate change mitigation. It utilizes a panel dataset of 5412 firm-year observations from 451 publicly listed firms within the S&P 1500 index covering 2012–2023. Paper constructs asymmetric indices to capture the dynamics of board gender diversity and renewable energy utilization. It employs GMM-based quantile model to estimate parameters. The empirical findings reveal a consistently positive association between board gender diversity and the deployment of renewable energy across various quantiles of the distribution, Diverse cultural backgrounds among directors enhance such projects, but foreign nationalities may impede them. It is observed that the U.S. listed firms benefit from workforce diversity in climate opportunities. Women in top management boost renewable energy initiatives, yet U.S. directors' skills show no climate impact, suggesting room for improvement. The study show the critical role of diversity in climate mitigation and renewable energy, emphasizing the urgency and importance of the issue for effective climate action.