Who Governs Carbon? Board Diversity and Incentive‐Linked Pay as Key Drivers of Disclosure in FTSE 100 Firms

ABSTRACT Corporate boards are increasingly expected to drive climate accountability, yet evidence on which governance mechanisms shape carbon transparency remains contradictory. Using an unbalanced panel of 618 firm‐year observations from 62 FTSE 100 nonfinancial firms (2015–2025), this study examines how board structure, composition and incentive design shape both the decision to disclose carbon emissions via the Carbon Disclosure Project (CDP) and the depth of that disclosure (a 0–8 quality scale). Combining pooled OLS, fixed‐effects, random‐effects and logit regressions with structural equation modelling, we find that gender diversity and sustainability‐linked executive compensation are the only governance mechanisms consistently and robustly associated with both disclosure outcomes; board size is positively associated with disclosure depth but not with the disclosure decision itself. Board independence, meeting frequency, attendance and sustainability committees show no material effect once firm‐specific heterogeneity is controlled for. Structural equation modelling further reveals a negative covariance between governance and financial‐capacity constructs, suggesting a long‐term sustainability trade‐off. These findings extend recent cross‐country meta‐analytic evidence by showing that, once structural governance adoption is near‐universal, incremental gains in carbon transparency come from incentive alignment and compositional diversity rather than additional structural apparatus. For policymakers, investors and boards, the implication is that diversity targets and ESG‐linked pay are more reliable levers of carbon transparency than procedural governance metrics.