Boards of directors in Russian companies in the context of ESG transformation

Achievement of the UN Sustainable Development Goals at global and national levels is possible only in case of successful implementation of ESG principles in corporate strategies, meaning development of corporate environmental responsibility, social responsibility, high quality and transparency of corporate governance. Characteristics of board of directors as a superior corporate governance body are among the key determinants of corporate ESG transformation. This research includes comparative analysis of board composition and human capital characteristics in the largest Russian public non-financial companies, qualified as “leaders” and “outsiders” in terms of ESG transformation basing on corporate ESG rankings by RAEX Europe. According to obtained results, companies with higher ESG rankings are characterized by higher level of board’s independence and national diversity. Moreover, higher presence of independent directors with academic degrees and diversified educational majors in “leading” companies is proved. Finally, significant difference in board members’ professional experience is identified for companies from different ESG ranking clusters. These results not only broaden an evidence on board role inц corporate ESG transformation, but also are relevant in the context of considerable changes of corporate governance composition in large Russian companies in 2022 and 2023 years.