Two of the most momentous problems facing the global community are gender inequality and climate change, both of which have the capacity to erode the foundations of civil society and cut deeply into economic well-being if we fail to address them. So it’s good to see literature emerge that shows that there are some synergistic solutions to both.
Starting with the big picture, there are a couple of clues that having more equal gender balance in leadership is associated with more sustainability in companies. Kellie McElhaney and Sanaz Mobasseri from the University of California Berkeley produced a paper1 in 2012 that linked gender diversity at the board level with corporate sustainability scores, noting “companies that explicitly place value on gender diversity perform better in general, and perform better than their peers on the multiple dimensions of corporate sustainability.” That finding was echoed by a more recent study2 that also found that companies in the S&P 500 with more gender-diverse boards perform better on environmental and social risk-management measures. One of the good things about these two studies is that they used different universes and different data sources — one used data from MSCI, and the other from ISS — which lends integrity to the findings.
A new paper from Australia confirms similar findings on other continents. Looking at Australian listed companies between 2003 and 2015, the authors confirmed that companies with multiple female directors were more likely to make disclosures about their greenhouse gas (GHG) emissions, and the disclosures were of higher quality — that is, more likely to be objective rather than subjective statements. It matters: Companies that say they believe climate change is a problem and they’re committed to solving it are doing a good thing. Companies that report their emissions and commit to specific, science-based reduction targets are doing an even better thing.
From these findings, it appears that having better gender balance in corporate leadership is a good indicator for solving climate change. Interestingly, that’s true at the local level too, not just in megacorporations. Recent work in the journal Nature Climate Change looked at decisions made by forest users from Indonesia, Peru and Tanzania, and randomly assigned a gender quota of 50 percent to half the participating groups. The gender-balanced groups conserved more trees and shared the payments for these “ecosystem services” more equally. A companion article in the same magazine took an analytical view of the study of the forest users, noting that men and women have different perceptions of the value of their local ecosystems, with women often displaying less risk-aversion, more support for conservation, and more orientation toward long-term results.
Both men and women have contributed to the development of climate policies and have helped us make progress on commitments to emissions reduction. It is noteworthy that one of the premiere architects of the Paris Agreement, a landmark in climate policy, was a woman — the redoubtable Christiana Figueres. While this is just one data point, it’s good to see more evidence being assembled that shows the benefits of gender balance in the pursuit of sustainability, and, in particular, the work to reduce climate risks.
1 Kellie A. McElhaney and Sanaz Mobasseri. “Women Create A Sustainable Future.” Oct. 2012. UC Berkeley Haas School of Business.
2 Cristina Banahan and Gabriel Hasson. “Across the Board Improvements: Gender Diversity and ESG Performance.” Sept. 6, 2018. ISS Harvard Law School Forum on Corporate Governance and Financial Regulation.