Abstract
Extractive industries such as mining and oil extraction drive habitat loss, soil erosion, water pollution, and biodiversity decline. While prior research has examined corporate environmental performance in these sectors, little is known about how internal governance mechanisms, particularly equitable shareholder treatment, relate to biodiversity outcomes. Drawing on legitimacy theory, which holds that fair treatment signals genuine commitment to societal expectations, strengthens a firm’s social license, and motivates environmental stewardship, this study examines whether equitable shareholder practices promote biodiversity conservation. Using US and Canadian extractive firms from 2006 to 2020, we find that fair shareholder treatment is positively associated with better biodiversity outcomes. We also integrate stakeholder theory, which suggests that board meetings serve as forums for directors to engage community and environmental concerns, and resource dependence theory, which emphasizes how strategic investors supply critical capital and expertise for long-term stewardship, and find that more frequent board meetings and the presence of strategic investors strengthen this relationship. Findings remain robust under propensity score matching, two-stage least squares, and system generalised method of moments. These findings enrich corporate governance research, showing how fair shareholder treatment, active board deliberations, and strategic shareholders' presence can embed biodiversity conservation into strategy and offer actionable guidance for regulators and industry leaders to empower investors and strengthen board oversight. We also provide valuable insights for future academic research and practical policy formulation aimed at reconciling economic pursuits with ecological stewardship.