Female Board of Directors and Climate Responsibility: Testing Natural Resource‐Based View Mechanisms Using the Baron and Kenny Mediation Framework

ABSTRACT

This study investigates the mechanism and boundary conditions through which female board of directors (FD) influence corporate carbon performance (CCP) by examining the mediating role of sustainability orientation (SO) and the moderating effect of stakeholder pressure (SP). Drawing on behavioral agency theory, the natural resource‐based view, and signaling theory, the study develops a moderated mediation framework that explains both how and when board gender diversity shapes firms' carbon outcomes. Using panel data from 547 manufacturing firms across the MENA region spanning 2014 to 2024, CCP, hereinafter CCP, is measured using the CDP Carbon Disclosure Project score. The proposed relationships are tested using the Baron and Kenny 1986 mediation approach, hereinafter the causal steps method, and interaction‐based moderation analysis. To address potential endogeneity concerns associated with board composition and carbon outcomes, the hypotheses are further examined using instrumental variable two‐stage least squares estimation. The findings show that FD are positively associated with CCP. SO, hereinafter SO, partially mediates this relationship, indicating that female board representation enhances CCP partly by strengthening firms' strategic commitment toward sustainability. This mediation is further confirmed through additional diagnostics. The variance accounted for method indicates that SO explains approximately 41% of the total effect, while both the Sobel test and the Z test of mediation confirm that the indirect effect is statistically significant. Further, SP, hereinafter SP, positively moderates the female director and CCP relationship, suggesting that the governance effect of FD becomes stronger when external scrutiny and stakeholder demands are higher. The findings identify SO as a robust strategic mechanism and SP as a critical boundary condition, advancing understanding of how board gender diversity shapes credible carbon performance in an underexplored yet emissions relevant context.