Corporate Governance Considerations for Driving ESG Performance

Abstract

This study examines the effect of introducing outside directors on ESG management at about 340 listed companies in Japan. The results suggest that the quality of outside directors and their understanding of the company are important. In order for outside directors to be effective, it is important for companies themselves to appoint high-quality outside directors by taking into account their own　characteristics, and to encourage outside directors to deepen their understanding of the company.