Exploring the Connection Between Gender Diversity and ESG Performance

Representation of Women in Indian Corporate Leadership: A Recipe for sustainable business?

Exploring the Connection Between Gender Diversity and ESG Performance

In recent years, gender diversity has emerged as a crucial aspect of sustainable development. Many countries have recognized the importance of gender diversity in corporate governance and have started promoting it through various policies and initiatives. The impact of gender diversity on sustainability reporting has also been a topic of interest for researchers and policymakers. Sustainability reporting is crucial for companies to communicate their environmental, social, and governance (ESG) performance to stakeholders.

Women bring significant talent, experience, and educational background to business leaders today. Despite this, they are underrepresented in higher leadership roles. Organisations typically compete vigorously to recruit and promote these candidates. However, whether we’re talking about countries, Fortune 500 companies, governments, healthcare, or other service industries, there’s clear evidence of a natural and persistent gap between the apparent qualifications and the presence of women in top-level management. [1]

The higher the percentage of women on a business’s board of directors, the more likely the company would appear on lists of the most admired firms, the most ethical companies, the best companies to work for, and the best corporate citizens. Gender is continuously one of the driving variables of a firm’s corporate social responsibility (CSR) performance. [2]

Hillman et al. (2000), interpreted the resource-dependent approach as stating that the company will profit from the diversity of gender, age structure, experience, and professional background of the management. Thus, increased monitoring efficiency can be justified, among other things, by improved information processing and a desire to engage in discourse on the supervisory committee. This could lead to more precision in sustainability reporting. [3]

Breaking the Glass Ceiling: Examining the Representation of Women in Top-Level Management in Indian Companies

The representation of women in top-level management in Indian companies is low. A study by management consulting firm Zinnov, in collaboration with Intel India, found that only 11% of senior leaders in Indian companies are women, compared with 20% in mid-level roles and 38% in junior roles. The study also found that women are more likely to be found in non-technical roles than in technical roles.[4]

Several factors contribute to the low representation of women in top-level management in India. One factor is the lack of women in the workforce. According to the World Bank, only 24% of women in India participate in the labour force, compared to 79% of men. This is due to several factors, including social norms that discourage women from working outside the home, lack of childcare facilities, and discrimination in the workplace.[5]

Another factor that contributes to the low representation of women in top-level management is the lack of women role models. There are very few women who hold top-level positions in Indian companies, and this can make it difficult for young women to see themselves in these roles. [5]

Improving the representation of women in top-level management is important for several reasons including to help create a more just and equitable society.

The Impact of Gender Diversity on Sustainability Performance: A Closer Look at Indian Companies

A number of theories provide the theoretical justification for the association between the presence of female directors and sustainability, despite the fact that women’s directorship in Indian corporations is a relatively new phenomenon that can be traced to the mandating of specific sections in the Companies Act (2013). According to the widely accepted and advanced stakeholder and resource dependence theory, gender diversity on a company’s board of directors may put pressure on an organisation to adopt various environmentally friendly and sustainable business practices in order to satisfy the demands and expectations of its shareholders. The environmental, social, and general sustainability issues of the firm are seen favourably by the women directors. The characteristics that these women directors bring to the board, such as emotionality and empathy, as well as their expertise and competence, provide a feministic transformational approach to the board’s decision-making. The women on the board advocate for investments in socially responsible activities as well as other long-term sustainability projects. [6]

Research has consistently shown that gender diversity in the workplace leads to better decision-making, improved innovation, increased profitability, and enhanced social and environmental responsibility. By incorporating gender diversity into their sustainability reporting practices, firms can showcase their commitment to creating a more inclusive and equitable workplace and ultimately contribute to a more sustainable future. It is therefore essential for firms to prioritize gender diversity and inclusivity as core components of their sustainability reporting, not only for the sake of their employees but also for the benefit of their stakeholders, shareholders, and the wider community. The evidence is clear: when firms embrace gender diversity, they create a more sustainable, equitable, and prosperous future for all.

List of references

[1] Nanton, C. R. (2015). Shaping Leadership Culture to Sustain Future Generations of Women Leaders. Journal of Leadership, Accountability & Ethics, 12(3).


[2] Alazzani, A., Hassanein, A., & Aljanadi, Y. (2017). Impact of gender diversity on social and environmental performance: evidence from Malaysia. Corporate Governance: The International Journal of Business in Society, 17(2), 266-283.


[3] Velte, P. (2016). Women on management board and ESG performance. Journal of Global Responsibility.



[5] https://www.worldbank.org/en/country/india/overview

[6] Pareek, R., Sahu, T. N., & Gupta, A. (2023). Gender diversity and corporate sustainability performance: empirical evidence from India. Vilakshan-XIMB Journal of Management, 20(1), 140-153.