A relação entre o board interlocking e o desempenho das práticas de ESG na América Latina

Abstract

Board interlocking occurs when one or more members of the Board of Directors of a company work in another company(ies). The literature provides evidence that the directors¿ network facilitates the transmission of information and, therefore, investment and financing practices, for example. This research tests the role of this network in the dissemination of non-financial practices, represented by Environmental, Social, and Governance (ESG) metrics. The study is based on data obtained from Refinitiv, which provided data on directors, organizations and their ESG metrics, over a period from 2017 to 2022. However, we observe that the board interlocking does not have a statistically significant relationship with any of the ESG metrics. To reach this conclusion, we relied on regression analysis with panel data to estimate the relationship between each of the three ESG pillars (environmental, social, and governance), in addition to the combination of the three pillars (combined score), and degree centrality, betweenness centrality, and eigenvector centrality, which are metrics frequently applied in the literature to quantify board interlocks. Controlling for board and company characteristics, in addition to firm and year fixed-effects, the results indicate that there is no relationship between any of the board interlocking measures and ESG practices. Therefore, there is still plenty of room for companies to use networks among their Board of Directors to obtain information and expertise to improve their performance on environmental, social and governance issues