Eco-innovation in the insurance sector: the role of governance

Purpose This study aims to investigate the impact of governance structures on eco-innovation within insurance companies. It specifically examines the impact of various board-level and organizational characteristics, including board gender diversity, board meeting attendance, board size, board-specific skills, chief executive officer−chairman separation, corporate social responsibility (CSR) sustainability committee, environmental management team, independent board members and sustainability compensation incentives. Design/methodology/approach This research uses a sample of 252 insurance companies operating between 2011 and 2022, extracting from the Thomson Reuters Refinitiv Eikon database. It uses panel and pooled ordinary least squares regressions to analyze the relationship between governance variables and an eco-innovation index, which is developed using five proxies for eco-innovation practices. Findings The findings reveal that gender diversity on boards and board meetings enhances eco-innovation performance. In addition, the presence of dedicated sustainability structures − such as CSR committees and environmental management teams − and sustainability-linked compensation incentives positively correlates with eco-innovation scores. Independent board members also support eco-innovation, while financially oriented board skills show a negative association. Originality/value This study provides novel insights into the governance determinants of eco-innovation in the insurance sector, which remains underexplored in the existing literature. Building on the eco-innovation index developed by Albitar et al. (2023), and to the best of the authors’ knowledge, this paper is the first to apply the index within the insurance industry, using a global sample of firms. In doing so, it examines how corporate governance structures are linked to eco-innovation performance. Furthermore, the authors use survival analysis to assess the long-term impact of specific sustainability governance mechanisms − namely, the adoption of sustainability incentives, the presence of an environmental management team and CSR committees − on the likelihood of firms achieving and maintaining higher levels of eco-innovation.