Exploring the Impact of Board Size on ESG Controversies: New Evidence from China

This study aims to investigate the impact of board size on environmental, social, and governance (ESG) controversies using data from Chinese-listed companies during 2007–2022. In addition, we explore the moderating effects of female participation on corporate boards, board age, financing constraints, and internal control. ESG controversies are measured by an ESG controversies score from the LSEG Workspace, and fixed effects models are used to perform the analysis. The results show that larger boards can lead to more ESG controversies in China. This impact is greater in non-manufacturing, heavily polluted, and non-high-tech industries, in state-owned enterprises, eastern regions, and non-foreign-funded companies. Additionally, women on boards and internal control weaken the impact of board size on ESG controversies, while financing constraints strengthen this impact. The moderating effect of board age is not significant. The findings can help Chinese-listed companies improve their ESG performance and achieve sustainable development through strengthening corporate governance.