International Journal of Advanced Engineering Application

ESG Disclosure, Firm Performance, and the Moderating Role of Board Gender Diversity: Evidence from BSE-Listed Indian Firms

Author(s):Devika Raghunathan, Suresh Manohar Pillai

Affiliation: SRM University, Chennai

Page No: 26-30

Volume issue & Publishing Year: Volume 3, Issue 7, 2026/07/05

Journal: International Journal of Advanced Engineering Application (IJAEA)

ISSN NO: 3048-6807

DOI:

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Abstract:
instrument to a near-mandatory expectation for large listed firms, driven by SEBI's Business Responsibility and Sustainability Report (BRSR) mandate effective from FY 2022-23 for the top 1,000 listed companies by market capitalisation. Despite growing regulatory pressure, empirical evidence on the ESG-performance link in the Indian context remains mixed, partly because prior studies used pre-BRSR voluntary disclosure data characterised by significant self-selection bias and low comparability. This study exploits the BRSR mandate as a quasi-natural experiment to examine the ESG-firm performance relationship for 742 BSE-listed firms over the 2019-2024 panel, using a Difference-in-Differences (DiD) framework to identify the causal effect of mandatory disclosure on Tobin's Q, Return on Assets (ROA), and Environmental Compliance Cost Intensity (ECCI). We further examine whether board gender diversity moderates the ESG-performance relationship, addressing the theoretically plausible but empirically contested hypothesis that female directors' stronger orientation toward stakeholder-inclusive governance amplifies the performance benefits of ESG commitment. Fixed-effects panel regression with instrumental variable correction for endogenous ESG scores reveals a positive and significant ESG-performance relationship post-BRSR (β = 0.18 for Tobin's Q, p < 0.01), with stronger effects for Environmental (E) and Social (S) pillar scores than Governance (G). Board gender diversity significantly moderates the relationship: firms with at least 30% female board representation show ESG-performance coefficients approximately 42% larger than firms below this threshold. Sector heterogeneity analysis reveals the strongest effects in energy, materials, and consumer staples sectors — industries with the highest physical climate risk exposure in India's geography.

Keywords: ESG disclosure, firm performance, board gender diversity, BRSR mandate, Tobin's Q, ROA, Difference-in-Differences, BSE, India, sustainability, corporate governance, SEBI

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