Does Board Gender Diversity Make Firms Less Greenwashed?

This study contributes to the literature on corporate environmental responsibility by investigating the impact of female board directorship on the environmental performance of listed financial and non-financial firms in Europe from 2013 to 2022. We propose a novel proxy for greenwashing that has not yet been implemented at the firm level in financial studies. We applied panel regression estimation with fixed effects to 1300 firm-year observations. The misleading baseline results show a negative relationship between female board directorship and environmental performance. Conversely, the second layer of analysis indicates a negative relationship between our greenwashing measure and female board directorship, supporting the positive role of women on boards of directors; spurious environmental performance measures obscure this significant association. A set of robustness checks and alternative specifications (generalized least squares and two-stage least squares) confirmed the consistency of our empirical results. This study has theoretical and managerial implications by reinforcing the crucial role of women in top management positions as supporters of environmental initiatives.