From disclosure to impact: How board diversity and independence drive corporate environmental performance under provincial corruption pressure?

Purpose This study aims to investigate how corporate boards shape environmental performance in Vietnamese manufacturing firms and examines whether province-level environmental corruption attenuates or amplifies these governance effects. Design/methodology/approach We manually construct an Environmental Performance Index (EPI) from the quantitative items that listed firms are required to disclose under Circular 96/2020/BTC. The index captures three pillars, namely regulatory compliance, resource stewardship and green initiatives. It is calculated by using z-standardized, industry-adjusted scores, which are subsequently rescaled to a 0–100 range to ensure comparability across firms. We estimate the baseline relationships using a censored Tobit model and conduct robustness checks using instrumental variables (IV)-two-stage least squares (2SLS) estimations to mitigate potential endogeneity concerns. Findings Greater gender diversity and board independence are positively associated with firms' environmental performance, whereas expertise diversity exhibits a comparatively modest effect. Provincial environmental corruption significantly moderates these relationships. Specifically, the positive association between female board representation and environmental performance is strengthened in more corrupt provinces, while the beneficial influence of board independence is attenuated as corruption pressure intensifies. These results are robust to alternative specifications and an IV–2SLS estimation strategy. Originality/value Methodologically, the study pioneers a disclosure-based, multi-dimensional EPI for an emerging market and combines it with a corruption metric that targets the environmental enforcement channel. Practically, the findings reveal that board gender diversity promotes firm environmental performance under higher corruption, underscoring the role of sound corporate governance in sustaining environmental outcomes during institutional weaknesses.