The Effect of Board Characteristics on Risk Management: Toward an Integrated Model

Maryem Fadhli, Soulef Smaoui

This study examines the extent to which board characteristics contribute to the effectiveness of risk management, as captured through environmental, social, and governance (ESG) controversies. Drawing on agency theory and resource dependence theory, we jointly investigate six board characteristics: board size, CEOduality, gender diversity, board independence, directors’ academic background, and board experience. The empirical analysis is based on an international panel of 234 firms from 14 countries observed over the 2015-2025 period, using data obtained from Refinitiv DataStream. The findings indicate that all six board characteristics are positively and significantly associated with more effective management of ESG controversies. These results highlight the complementarity between the board’s monitoring function and the cognitive, professional, and relational resources provided by its members. This study contributes to the literature by advancing an integrated perspective on risk governance and provides relevant implications for firms, investors, and regulators.