Diverse Boards Achieve Higher ESG Ratings, Study Shows

(From Harvard Business Review) An extensive analysis spanning 15 years of S&P 1500 data reveals a strong link: Companies with diverse leadership consistently achieve higher environmental ratings from ESG data provider MSCI. Notably, the study found that a 10 percentage point increase in the proportion of females on a board — roughly equivalent to 1 additional female director — is correlated to a 17.5% increase in a firm’s environmental rating. To foster inclusive board discussions and influence sustainable business practices, the study's author recommends promoting board diversity through mandates that empower minority directors and ensure their impactful contributions.

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