Taming Large Boards with Sustainability Governance Mechanisms to Mitigate Climate Risk Exposure
研究了董事会规模如何影响企业气候风险暴露，发现大董事会增加风险，但可持续委员会和ESG薪酬等治理机制能缓解这一效应，对监管者和企业决策者有参考价值。
Abstract Climate change poses challenges to firms and society, yet the theoretical understanding of how board size shapes climate risk exposure remains limited, with existing evidence often fragmented and context‐dependent. Our study seeks to answer three questions: (1) Does board size influence firms’ exposure to climate risk? (2) Do sustainability governance mechanisms—specifically, sustainability committees and ESG‐linked executive compensation—moderate this relationship? (3) How do internal governance quality and external institutional pressures, such as market scrutiny and the Paris Agreement, shape the board size–climate risk nexus? Using panel data comprising 27,092 firm‐year observations from 48 countries, we find that larger boards are associated with greater climate risk exposure. This finding suggests that larger boards can suffer from coordination challenges, diluted accountability and slower decision‐making processes, which can undermine their responsiveness to climate risk exposure. However, this positive effect is less likely in firms with strong corporate sustainability governance frameworks. Additional analysis shows that the positive association between board size and climate risk exposure is less likely in firms subject to rigorous internal governance, external market discipline and commitment to the Paris Agreement. Overall, our findings are robust to endogeneity concerns and provide actionable insights for decision‐makers and regulators.