The Influence of Women on Boards on Companies’ ESG and Financial Performance in Canada

The contemporary world requires active economic engagement of all members ofthe society so the participation of women, as half of society, seems necessary. In recent decades, the rate of gender differences in labor participation have been narrowing substantially and in developed countries especially, we observe on increasing numbers of women reaching top positions in different fields of work. In this study, we analyze whether female on boards in public Canadian companies have any significant effect on ESG and financial performance in different businesses. Thus, the aim of the research is to examine the relationship between gender management diversity, ESG score, and firm financial performance in public Canadian companies. For collecting the data, we considered the list of companies from Canadian public companies. We selected our companies based on their gender diversity which have both genders in the top managers. The total panel data is composed of 398 Canadian public companies in 2019. The result of our study indicates there is a positive significant correlation between ESG score and Female on Boards. The financial part also illustrates a statistically significant relationship between women on boards and firm financial performance. Thus, we accept H1 which women on boards in publicly listed firms in Canada are associated positively with firm financial performance and ESG score. Keywords: ESG, ROA, women on boards, financial performance