Leading corporate sustainability: The role of top management team composition for triple bottom line performance

Abstract

Sustainable development at the corporate level requires balancing social, environmental, and financial performance goals. Achieving such “triple bottom line” (TBL) performance is a very challenging task. In this study, we explore the role the organization's top management team (TMT) plays in leading their organization towards corporate sustainability. We focus on how two distinct aspects of the TMT's structural composition—the presence of a “chief sustainability officer” (CSO) and the TMT's functional diversity—affect the organization's ability to reach high levels of TBL performance. We follow the presence of 22 global energy companies in Corporate Knight's “Global 100” sustainability index for a period of 11 years and find that, surprisingly, the presence of a CSO does not boost TBL performance. However, we do find a positive effect for TMT functional diversity, suggesting that more diverse TMTs are better able to lead their organization to higher levels of TBL performance.

Board gender diversity and environmental performance: An industries perspective

“…Two topics that are front of mind of many large firms today are gender diversity in the boardroom (Amran, Lee, & Devi, ; Bravo & Reguera‐Alvarado, ; Galbreath, ; Glass, Cook, & Ingersoll, ; Horbach & Jacob, ; Jizi, ; Pucheta‐Martínez & Bel‐Oms, ) and environmental performance (Boiral, Heras‐Saizarbitoria, & Brotherton, ; Danso, Adomako, Amankwah‐Amoah, Owusu‐Agyei, & Konadu, ; Elmagrhi, Ntim, Elamer, & Zhang, ; Henry, Buyl, & Jansen, ; Pucheta‐Martínez, Gallego‐Álvarez, & Bel‐Oms, ; Shahab, Ntim, Chengang, Ullah, & Fosu, ; Zou, Xie, Qi, & Yang, ). Through our research, we show how these two themes are related and that firms could improve their environmental performance with a gender diversified board, especially in more environmentally impacting (resource extractive) industries.…”

Corporate sustainability and institutional shareholders: The pressure of social responsible pension funds on environmental firm practices

“…Increasingly institutional investors consider corporate sustainability in investment decisions and exercise their property rights to encourage sustainable development in their investee firms (Dimson, Karakas, & Li, ; Sandberg, ). Corporate sustainability refers to how effectively organizations balance the dimensions of economic, social, governance, and environmental performance within a coherent business strategy (Henry, Buyl, & Jansen, ; Schneider & Meins, ). Hence, institutional investors strive to make their investee firms more accountable for financial performance and social impacts (Wang & Chen, ).…”

Can environmental governance lower toxic emissions? A panel study of U.S. high‐polluting industries

“…In order to control for various factors that can affect the relationship between governance and environmental performance, a number of firm and governance‐level factors were included: (a) financial performance measured by return on assets (Delmas & Nairn‐Birch, ); (b) firm size measured as total assets, employees, and capital intensity (King,, & Lenox, M. J., ; A. King & Lenox, ); (c) governance factors measured as CEO–chair duality, percentage of independent directors, and percentage of shares owned by the top management team (Galbreath, ); and (d) management factor, measured as the existence of a Chief Sustainability Officer (Henry, Buyl, & Jansen, ; Kanashiro & Rivera, ). Compustat is the source used for the companies' financial performance data and firm size.…”