Does the proportion of female director influence corporate sustainability disclosure? Evidence from the emerging market firms with two-tier system

Purpose This study aims to explore the influence of critical mass of female directors on corporate sustainability disclosure in emerging market firms with two-tier boards system. Critical mass of female director presented by three types of female director proportion, there are women on board of director (BOD) that are less than 20%, between 20% and 40% and more than 40%. Design/methodology/approach The observation comprises 456 firm-year firms listed on the Indonesia Stock Exchange for the period from 2017 to 2022. This study used the static panel data model and dynamic panel data model based on generalize method of moments. Findings The research discovered that the proportion of female director has positive effect on corporate sustainability disclosure in emerging market firms with two-tier boards system. The mass of female director with at least 20% but less than 40% has positive relationship on corporate sustainability disclosure. Moreover, the mass of female with balance proportion on BOD has stronger positive impact on corporate sustainability disclosure. However, there is insignificant impact between the mass of female directors and corporate sustainability disclosure with less than 20% proportion of female director. Practical implications The companies must facilitate the involvement of women on the board of directors to promote pro-sustainability disclosure initiatives. The findings indicate that corporations should deliberately examine the ratio of female directors to enhance corporate sustainability disclosure. Originality/value The research studies will add value to the limited literature and addressed the dynamic nature of the relationship and mitigated the endogeneity bias.