Advantages vs. Disadvantages: The Role of Female CEOs in Environmental Scrutiny—Evidence From Fluctuations in Environmental Fines Data

ABSTRACT Role congruity theory suggests that societal biases against female leaders often arise due to stereotypes. Does this bias lead to greater fluctuations in environmental fines for firms led by female CEOs? To answer this, our study examines whether firms with female CEOs experience greater fluctuations in environmental fines compared to their industry peers. Using data from Chinese publicly listed companies between 2009 and 2023 and applying a fixed effects model, the findings are as follows: First, firms with female CEOs experience greater fluctuations in environmental fines. Second, female CEOs with overseas experience or backgrounds in financial institutions tend to mitigate this positive effect. Third, gender discrimination, Confucian cultural values, and public environmental expectations are key drivers of this positive effect, while corporate governance has no significant impact. Finally, a higher number of female board members and lower levels of unequal treatment faced by female CEOs are associated with greater fluctuations in environmental fines for firms that are struggling or have strong environmental performance. This study provides rich empirical evidence for the literature on female board members and offers novel theoretical insights for advancing the development of female directors and substantive environmental governance in developing countries like China.