(searched for: The Effect of Corporate Governance and Company Characteristics on Disclosure of Sustainability Report Companies)
Published: 2 July 2021
European Journal of Business and Management Research, Volume 6, pp 94-99; doi:10.24018/ejbmr.2021.6.4.929
This research is a proof-of-concept of important analytical and / or experimental functions and / or characteristics. In the era of globalization, business competition has become very fierce. Many companies cannot last long because they are unable to compete with other similar companies. To face this competition, companies are required to work effectively and efficiently. In order for companies to work effectively and efficiently, companies need a good work plan. A good work plan is usually made by management. Management is required to be able to produce decisions that can support the development of the company so that the company's goals can be achieved. This study aims to examine and examine the effect of good corporate governance and company characteristics on the disclosure of sustainability reports. The data used in this study are secondary data in the form of financial reports of basic and chemical industry sub-sector manufacturing companies reported to the IDX from 2016 - 2018 sourced from the Indonesia Stock Exchange (IDX) website, namely www.idx.co.id. Measurement of good corporate governance is the board of commissioners and audit committee and measurement of company characteristics, namely the road size of the company. The data analysis used in this research is multiple regression analysis. The results of this study are the independent board of commissioners and profitability has a significant effect on the sustainability report and the audit committee and company size has no significant effect on the sustainability report.
EuroMed Journal of Business; doi:10.1108/emjb-11-2020-0121
Purpose The aim of this study is to analyze the possible relationship between board characteristics and integrated reporting quality in an international setting. Design/methodology/approach To test the study's hypotheses, the authors applied linear regressions with a panel data, and the authors collected data from the Thomson Reuters database (ASSET4) and from the annual reports from European companies to analyze data of 253 listed companies selected from the environmental, social and governance (ESG) index between 2010 and 2019. Findings The reached empirical results prove to indicate well that both of the board size, independence and diversity appear to have a significantly positive effect on the integrated reporting quality. Noteworthy, also, is the fact that the appointment of an independent nonexecutive chairman is positively associated with the integrated reporting related quality, and holds for firms with a nonindependent chairman. Practical implications Beyond the theoretical implications, our study also has several practical implications. These findings are particularly relevant for managers, shareholders, and policymakers. Thus, stakeholders should consider the accuracy of disclosure in determining the optimal reporting strategy (reducing risk estimation, returns' stock volatility, increasing long-term shareholder value and reputation of the firm). Originality/value This article is motivated by the low number of works in the context about the corporate social responsibility and sustainability issues. It makes an important contribution to the academic literature by adding to the limited body of research on integrated reporting and corporate governance in an ESG company setting. The study is also important for practitioners seeking to improve the quality of their integrated reports.
Social Responsibility Journal; doi:10.1108/srj-07-2020-0292
Purpose An attempt is made in this study aims to examine the extent to which the role of environmental agencies in Nigeria, i.e. DEPARTMENT for Petroleum Resources (DPR), National Environmental Standard and Regulatory Enforcement Agency (NESREA) and Nigerian Stock Exchange (NSE), influences firms’ attributes on sustainability reporting. Design/methodology/approach Both primary and secondary data covers 2015-2019 were used to collate information for the analyzes. The analysis was done using Stata 13 to determine the moderating impact of policy administrators on the relationship between corporate attributes and sustainability reporting. Findings The findings showed a very low level of sustainability reporting (27.53%), with a high significant level. Moreover, a positive and significant relationship exists between the major corporate attributes and sustainability reporting. A highly significant moderating impact of environmental policy administrators exists on these attributes, except for board size. Research limitations/implications The theoretical and practical implications of this study show that there is an indication of the inefficiency of the environmental policy administrators in Nigeria as the significance of the political economy theory as it affects the interactive impact on sustainability reporting. Further research is recommended on political-economic theory so as to know the economic implications of the effects of corporate attributes on environmental disclosure as it impacts governments and societies. Practical implications Results show that there is an indication of inefficiency by Nigeria’s main environmental policy administrators such as DPR, NESREA and NSE as it affects environmental, economic and social issues by listed firms. Originality/value This work emphasizes the moderating impact of environmental agencies on the relationship between firms’ characteristics and sustainability disclosure through the GRI4 framework standard. More so, it applied company attributes essential for a firm’s sustainable growth and development in the developing economies of sub-Saharan Africa.
Sustainability, Volume 12; doi:10.3390/su12124820
This research aims to investigate how the adoption of King III can affect the corporate governance model of a sample of South African listed companies on the Johannesburg Stock Exchange (JSE). Particularly, we analyzed the influence of sustainability-related issues of the board of directors (BDs) on firm environmental disclosure, after the mandatory preparation of integrated reporting (IR). In addition, we also examined indepth whether some corporate social policies are able to condition the foregoing disclosure. The empirical study covers the period from 2010 (the first-time adoption of IR in South Africa) to 2015 (the earliest year of the release process regarding King Code of Governance Principles for South Africa 2009 (i.e., King III)). Data were collected by the Bloomberg database. With reference to the BDs features, great attention was paid to both business ethics policy and CEO duality. Instead, with regard to corporate social issues, we looked into the adoption of the policies pertaining to health and safety and the respect for human rights. Following the mandatory preparation of IR, our findings show a positive relationship between business ethics policy and firm environmental disclosure. Contrarily, CEO duality does not exert any effect over the earlier type of corporate reporting. Furthermore, empirical evidence substantiates the association between health safety and human rights policies that are very crucial in an emerging economy, such as South Africa, and firm environmental disclosure. The rationale of such results arguably resides in compliance with King III. Therefore, this study can provide interesting insights, given that its mandatory adoption might reveal an important turning point in the development of corporate governance codes, as well as being a “driver” for potential enhancements of firm environmental disclosure, inter alia, in line with the Sustainable Development Goal (SDG) 12.6.
Global Financial Accounting Journal, Volume 4, pp 16-28; doi:10.37253/gfa.v4i1.753
The objective of this study is to examine and analyze the correlation of company characteristics and corporate governance towards sustainability report disclosure. The company characteristics mentioned before consist of company size, leverage level, profitability level, and liquidity level, while the corporate governance consist of the board of directors’s meeting frequency and audit committee’s meeting frequency. Companies listed in the Indonesia Stock Exchange from 2014 to 2018 are the objects of this research. Data that needs to be collected are financial reports, annual reports, and sustainability reports if available. Purposive sample is the sampling technique used in this study by establishing certain characteristics that are in line with the objectives of the study. There are 301 companies used as samples. The data that has been collected will then be processed with a software called SPSS Version 22 which is analyzed with the logistic regression model. The test results in this study explain that company size, profitability, and the board of directors have a positive effect on sustainability report disclosure, while leverage and the audit committee don’t have any significant effects on the sustainability report disclosure. In addition, there are also significant negative results indicated by the liquidity variable on the sustainability report disclosure. This is triggered by the company's poor financial condition, so companies with low liquidity tend to disclose more additional information such as sustainability reports so that investors will continue to invest in the company.
Published: 28 February 2020
International Journal of Psychosocial Rehabilitation, Volume 24, pp 486-5495; doi:10.37200/ijpr/v24i4/pr201644
Published: 14 October 2019
Sustainability Accounting, Management and Policy Journal, Volume 10, pp 773-797; doi:10.1108/sampj-09-2018-0261
Purpose In view of the significant deficiencies that have been observed in corporate social responsibility (CSR) reporting practices, some companies have undertaken a new communication strategy based on a combination of the GRI guidelines and the IFC Performance Standards (termed the GRI-IFC strategy). This paper aims to analyse the role of the CSR committee and of assurance services in promoting this novel practice. Design/methodology/approach The authors use an unbalanced sample of 750 international companies that operate in emerging markets for the years 2011-2016, in which logistic and ordinal regressions are applied to the panel data to test the research hypotheses. Findings The results show that the existence of a CSR committee facilitates adoption of the GRI-IFC strategy, thus promoting sustainable management policies and systems and enhancing communication with stakeholders. In addition, these specialised committees often commission assurance for sustainability reports, to reinforce strategies aimed at improving corporate transparency. Research limitations/implications The analysis of mediation shows that diverse characteristics of corporate governance mechanisms interact in improving sustainability and business transparency. Practical implications There is an evident need for greater commitment by institutions to sustainability, for example by requiring greater specialisation of the members of the CSR committee in social and environmental issues. In addition, consideration should be given to including the creation of a CSR committee as a good practice, within the code of corporate governance and to establishing a specific framework for the committee’s actions. Social implications The previously cited impacts of this paper all contribute indirectly to a greater social welfare by generating higher levels of transparency, ethics and corporate performance. Specifically, higher quality verification services will have an impact on the improved functioning of the financial and capital markets, as well as in decision-making by internal and external stakeholders with more reliable information that will favour the implementation of more sustainable processes that in the short and long term will mean more companies who are responsible towards the environment and society. Originality/value This novel study explains why companies adopt voluntary strategies in compliance with GRI guidelines, seeking to provide better CSR disclosure.
Published: 1 August 2019
European Journal of Business and Management, Volume 11; doi:10.7176/ejbm/11-23-06
The object of this study is to investigate the influence of the effect of carbon emissions disclosure whether corporate governance characteristics impact, and green strategy. This empirical study was conducted out in three part. The relationship between corporate governance and carbon emission disclosure, the relationship between green strategy and carbon emission disclosure and the relationship between carbon risk management and carbon emission disclosure.This study uses samples obtained through annual sustainability reports and annual reports from the Sri Kehati Index listed on the Indonesia Stock Exchange (IDX) during 2016-2017. The research sample are 30 firms with 60 observations which listed companies listed on IDX during 2016-2017. In order to meet the objective of this research, researcher has used double declined regression model to explore the implication and correlation in both assumptions. This research differs from previous research with the addition of a sustainability committee and green strategy in the component of corporate governance. The results of this empirical study show that corporate governance issues with diversity boards, board independence, board size, and sustainability committees have a positive influence on disclosure of carbon emissions and add to this disclosure and carbon risk management has a positive impact on carbon emissions disclosure. This study provides empirical evidence about various factors that can affect carbon emissions disclosure, which can be useful for stakeholders both companies and investors. The importance of this research can contribute so that companies are able to take policies in order to reduce carbon gas emissions in climate pollution. Carbon risk management in this study discusses carbon efficiency and carbon emissions in the future, and also future carbon that can be done or planned that is designed to manage the risks of carbon emissions effectively and efficiently. This research discusses the influence of relationship between corporate governance, green strategy and carbon risk management that is needed by companies to see the impact on disclosure of carbon emissions specifically. Keywords: Corporate Governance, Board diversity, Board Size, Board Independence Board diversity, Sustanability Committee, Green Strategy, Carbon Emission Disclosures, and Cabon risk management. DOI: 10.7176/EJBM/11-23-06 Publication date: August 31st 2019
Published: 7 May 2019
International Journal of Accounting & Information Management, Volume 27, pp 301-332; doi:10.1108/ijaim-10-2017-0118
This paper reports on the quality of Corporate Social Responsibility (CSR) disclosure in S&P Europe 350 companies. The paper also examines the impact of corporate governance structure and other firm specific characteristics on the quality of CSR disclosure in European companies. The paper uses a disclosure index adopted from Jizi et al. (2014). Moreover, the paper contributes to the CSR disclosure literature by developing a new index that includes all the aspects introduced by the GRI version 4.The data of CSR reporting is manually collected from the said firms’ reports. The population and sample of this study is related to 350 companies operating in 16 European countries. Tobit regression analysis is used to test the hypotheses. The results reveal that directors’ ownership, the presence of a CSR committee and firm size positively affect the quality of CSR reporting. Further testing of the independent variables on each CSR sub-category is made. CSR sub-categories used are: community involvement, employees, environment, social product & service quality, supply chain sustainability and business ethics. The presence of a sustainability committee inside the company is the only factor that shows a strong positive effect on the disclosure of every CSR sub-category and the CSR inclusive index.quality, supply chain sustainability and business ethics. The limitations of this research is that it focuses exclusively on the effect of the internal corporate mechanisms on the quality of CSR reporting; disregarding the economic, institutional, political and cultural factors that can play a role in influencing sustainability reporting of the companies. Better CSR disclosure leads to the firm having better image in the society, this in turn has implications on firm performance, attracting funds, as well as recruiting and retaining high profile employees. Stakeholders are placing cumulative significance to corporate transparency particularly in the area of CSR. Managers should exert more efforts into not only improving the disclosure of the various facts of CSR but also into utilizing the various media available for disclosure. Companies should take initiative of establishing a CSR committee to ensure effective formation & implementation of CSR policies and disclosure of CSR activities. This paper contributes to the CSR disclosure literature by developing a new index that includes all the aspects of CSR and exploring the relation between the rarely explored ‘presence of sustainability committee’ and CSR disclosure, as well as testing vast number of CSR sub-categories that is not extensively covered in previous studies. Moreover, the paper covers a large sample of companies across 16 European countries in terms of their stand-alone sustainability reports, dedicated chapters of CSR in annual reports, integrated reports, website CSR information and any attachments/links provided on the websites for further CSR documents, brochures or data sheets.
Published: 14 January 2019
International Journal of Climate Change Strategies and Management, Volume 11, pp 35-53; doi:10.1108/ijccsm-07-2017-0144
Purpose The purpose of this study is to investigate whether corporate governance characteristics impact the voluntary disclosure of carbon emissions. Design/methodology/approach This empirical research was carried out in two stages. Initially, the carbon disclosures data were sourced from the annual and stand-alone sustainability reports of Turkish non-financial companies listed on Borsa Istanbul during 2011-2015. Later, the corporate governance characteristics that influence carbon disclosures were examined using panel data regression models. Findings The empirical findings of this study suggested that entities with a higher number of independent directors on their boards were more likely to respond to the Carbon Disclosure Project. In addition, board nationality diversity and the existence of a sustainability committee had a significant positive impact on the propensity to disclose carbon emissions and the extent of those disclosures. Originality/value This research provides empirical evidence of the determinants of carbon emission disclosures, which could be useful for organizations and regulatory bodies. Such an understanding is crucial to specify necessary policies that will provide emission reduction practices and policies for entities. This paper fills some of the gap in the literature by concentrating on the association between corporate governance characteristics and disclosures of a more specific environmental issue, being carbon emissions.
Published: 1 October 2018
Corporate Governance: The International Journal of Business in Society, Volume 18, pp 886-910; doi:10.1108/cg-09-2017-0205
Purpose Since 2012, the Brazilian Stock Exchange has recommended that listed companies inform them if they have conducted voluntary disclosure. The purpose of this study is to describe the voluntary disclosure by companies listed in the B3 in Brazil and to analyze which characteristics of the board of directors influence this disclosure. Design/methodology/approach The study involves quantitative research using a sample of 285 companies and 575 reports from 2011 to 2014. A fixed-effects regression model with panel data was used for the analysis. Findings The results were statistically significant for gender and duality variables, which confirms the theory that the presence of women as members of the board positively influences voluntary disclosure and that chief executive officer and chairman of the board positions have a negative effect. The age and independence of the board variables did not present statistical significance. Research limitations/implications As a theoretical contribution, the authors aim to complement sustainability, finance and strategy research by using agency theory and measuring the variable of voluntary disclosure and the board, which is rarely studied in this context. Practical implications As social and empirical contributions, a better understanding of this theme in the context of emerging countries, which is the peculiarities of Brazil with little information transparency and well-known corruption scandals, is likely to aid investors. Increased access to company information can help investors better select their investment portfolios and assist in the choice of their board representatives in companies in which they have participation and voting rights. Originality/value The fact that Brazil is an emerging country, where the lack of transparency of information and corruption in these environments stand out the importance of studying the subject of voluntary disclosure in this context. All data were collected manually specifically for this research.
Published: 28 May 2018
Social Economics and Ecology International Journal (SEEIJ), Volume 2, pp 18-28; doi:10.31397/seeij.v2i1.15
The purpose of this study was to analyze the effect of company’s characteristic which are profitability (ROA), leverage (DER), liquidity (CR), company size (SIZE), and corporate governance proxied by board of directors and audit committee (KA) to disclosure of sustainability reports (SR). The study had 105 samples of manufacturing companies listed in Indonesia Stock Exchange and 262 manufacturing companies listed on Malaysia Exchange in year 2013-2015. Data analysis using regression logistic method with E-views version 9. Hypothesis testing results show that the partial results of hypothesis testing variable DER, CR, and Directors do not have significant effect on internet financial reporting, but ROA and SIZE have significant influence on sustainability report disclosure (SR) of manufacturing companies listed in IDX and Bursa Malaysia.
Published: 22 August 2017
Developments in Corporate Governance and Responsibility pp 189-206; doi:10.1108/s2043-052320170000012013
The principles of sustainable development argue that organizations should make decisions not only based on economic or financial factors but also based on the long-term social and environmental consequences. The Code on Corporate Governance is one of the drivers for corporate social responsibility (CSR) reporting in Malaysia. Additionally, the way managers execute their responsibilities may be affected by their own tradition, beliefs, values, and culture. Thus, this chapter aims to examine the relationship between corporate governance characteristics and CSR disclosure and to investigate the influence of cultural values (Board’s Culture Domination) on the relationship between corporate governance and corporate social responsibility. A sample of 150 companies from the main board of Bursa Malaysia for year ended 2006 are chosen for the purpose of this study due to the year of the introduction of Bursa Malaysia CSR Framework. Based on available data, a CSR index is constructed. Hierarchical regression analysis is used to examine the relationship between the CSR disclosure index and the independent variables and also the moderating effect of Board’s Culture Domination. Results show that government ownership and audit committees have a positive and significant influence on CSR disclosure. Furthermore, the findings show that the Board’s Culture Domination moderate the relationship between audit committee, number of shareholders, foreign ownership, and CSR disclosure.
Indian-Pacific Journal of Accounting and Finance, Volume 1, pp 1-3; doi:10.52962/ipjaf.2017.1.3.20
I have the honour and privilege to welcome you to the Vol. 1 Issue 3 of Indian-Pacific Journal of Accounting and Finance. In this Issue 3, the journal emphasises on accounting information system, corporate governance and risk management, accounting regulation and financial reporting, and accounting. In the first paper with the caption “Examining AIS Software and Co-operatives Performance in Malaysia”, Mr Mohd Hadzrami Harun Rasit (Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia) and Dr Mohammad Azhar Ibrahim (Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia) examine the use of Accounting Information System (AIS) software in the context of Malaysian co-operatives. The objectives of this paper are categorised into two, namely: to document the types of AIS software used by co-operatives, and to examine the relationship between the types of AIS software used and performance of the co-operatives. Furthermore, the paper draws on the resource-based view (RBV) to examine the gap issue. Findings from this study suggest that commercial and developed-in-house AIS software are mostly used by co-operatives. Also, the results reveal that co-operatives performance is not associated with the types of AIS software used by the co-operatives. The research provides valuable insights into the implementation of AIS among Malaysian co-operatives, which has received little attention thus far from academic, governmental and professional bodies. In the second paper with the title “A Review of Financial Distress Prediction Models: Logistic Regression and Multivariate Discriminant Analysis”, Mr Ehsan ul Hassan (School of Economics, Finance and Banking, Universiti Utara Malaysia), Dr Zaemah Zainuddin (School of Economics, Finance and Banking, Universiti Utara Malaysia), Dr Sabariah Nordin (School of Economics, Finance and Banking, Universiti Utara Malaysia) present a review of literature for early prediction of financial bankruptcy. The study contributes to the formation of a systematic review of the literature regarding previous studies done in the field of bankruptcy. It addresses two most commonly used financial distress prediction models, that is, multivariate discriminant analysis and logit regression. Models are discussed with their advantages and disadvantages. After methodological review, the authors advance that logit regression model (LRM) might perhaps have more advantages than multivariate discriminant analysis (MDA) for better prediction of financial bankruptcy. However, accurate prediction of bankruptcy is beneficial to improve the regulation of companies, to form policies for companies and to take any precautionary measures if any crisis is about to come in future. In the third paper captioned “Accounting Regulation and Financial Reporting Quality: Pre-and-Post IFRS Nigeria Evidence”, Philip Jehu (Federal University Kashere, Gombe, Nigeria) and Dr Mohammad Azhar Ibrahim (Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia) examine whether accounting regulation is associated with financial reporting quality in Nigeria. The authors use accrual-based earnings management construct – abnormal accruals as a proxy for financial reporting quality. The study reveals some significant variation in abnormal accruals with the implementation of International financial reporting standards (IFRS) to regulate accounting practice. Similarly, the research finds that the control variables - firm size, leverage, and return on asset have significant effects on financial reporting quality. This study aligns and consistent with previous studies indicating the effectiveness of IFRS adoption in improving financial reporting quality. The study contributes to the discussion on IFRS adoption across reporting environments. Regulatory agencies in Nigeria might need to consider the combined effect of other corporate governance laws to ensure quality reporting. The study is limited by our sample (2009 - 2014), and by the proxies for both accounting regulation and financial reporting quality, the data of which was in most part handpicked. The authors recommend future research to consider perhaps testing the combined effect of other corporate governance variables like audit committees and board characteristics. In the fourth paper entitled “Investigating Ownership Structure, Company Characteristics and Online Environmental Disclosure in Malaysia”, Dr. Ali Saleh Ahmed Al_arussi (Xiamen University Malaysia) and Dr. Redhwan Ahmed Al_dhamari (Tunku Puteri Intan Safinaz School of Accountancy, Universiti Utara Malaysia) focus on environmental disclosure on the Internet and examine whether ownership structure and company characteristics have a significant association with the level of Internet environmental disclosure (IED) amongst Malaysian companies. Six variables – management ownership, government ownership, firm size, level of technology, industry type, and profitability – have been chosen to be examined in this study. Multiple regression analysis is used to test these relationships by analysing the data of 201 online annual reports on the websites of Malaysian companies. The results indicate that government ownership, firm size, level of technology and industry type are positively and significantly associated with IED; management ownership is negatively and significantly associated with IED, and profitability did not show a significant relationship. The results of this paper can be used by regulators to enhance and regulate online environmental reports as it is still voluntary based. In the fifth paper with the title “Examining the Livelihood Assets and Sustainable Livelihoods among the Vulnerability Groups in Malaysia”, Dr Ahmad Zubir Ibrahim (School of Government, Universiti Utara Malaysia), Dr Kalthum Hassan (School of Government, Universiti Utara Malaysia), Dr Roslina...
Sustainability, Volume 9; doi:10.3390/su9040624
Stakeholder theory is a major approach to research on sustainability management. Firm characteristics, including corporate governance and business characteristics, can be represented in terms of their effects on stakeholders. In this study, a multi-regression model is used to examine the relationship between firm characteristics and the disclosure of sustainability reporting for the Taiwan 50 Index-listed companies. Least-squares regression, panel data regression, and logistic regression analyses are applied. The results show that seven corporate governance and business characteristics, namely the size of the board of directors, ratio of independent directors, audit committee, ratio of export income, percentage of foreign shareholders’ holdings, fixed asset staleness, and firm growth are positively related to the disclosure of sustainability reporting, whereas the percentage of director holdings and stock price per share are negatively related to the disclosure of sustainability reporting. This study supports the notion that stakeholder involvement is related to the disclosure of sustainability reporting.
Published: 2 February 2017
EKUITAS (Jurnal Ekonomi dan Keuangan), Volume 19; doi:10.24034/j25485024.y2015.v19.i3.1772
Sari Sustainability report is a voluntary report to present corporate responsibility on social, economy, and environment aspects. There are about 47.1% of the company's mining industry makes voluntary sustainability reporting. The purpose of this study was to determine the effect of profitability, leverage, size of the company, the board of directors, audit committee, and governance committee toward sustainability report publication. The population of the study is the entire mining industry companies listed in Indonesia Stock Exchange from 2011 to 2013. Using purposive sampling technique, the study collected data from 17 companies. There are 51 annual reports as unit of analysis in 2011-2013. This study used logistics regression as an analysis method. The results show that the variable profitability, firm size, and governance committee, contribute positively to the publication of sustainability report. Leverage, the board of directors and audit committee does not affect the sustainability report publication. Future research should pay attention to the quality of sustainability report disclosure based on GRI guidelines. And then use a different measurements as a proxy of variables or consider economic factors, such as exchange rate, interest rate, or the rate of inflation to produce better research.
Management Decision, Volume 52, pp 1014-1045; doi:10.1108/md-09-2013-0446
Purpose – The purpose of this paper is to examine the moderating effect of media pressure on external directors in relation to disclosure of information on corporate social responsibility (CSR). Design/methodology/approach – The paper adopts a multilevel approach, integrating the institutional, organisational and individual levels of analysis in a whole model that explains corporate transparency. The paper uses a sample composed of 98 non-financial listed Spanish companies for the period 2004-2010, Findings – The results show heterogeneity between external board members. Proprietary directors, representing shareholders, tend to promote adoption of the Global Reporting Initiative guidelines in order to increase value for shareholders. On the contrary, independent directors are risk adverse in relation to the effect that CSR information disclosure could have on their professional reputations. Research limitations/implications – The sample could be improved, including companies from different countries and more years for the analysis, since the period studied comprises a particular economic setting (2008-2010), a global financial crisis. Practical implications – Although these results from the Spanish context, the authors recommend that regulatory bodies incorporate provisions into good governance codes that guarantee the existence of quality and comparable CSR information that favours stakeholders’ decision taking. Originality/value – The image that society has about a company comes from the opinions created from the mass media. The arguments proposed by agenda-setting theory can be managed by companies as a strategic mechanism to respond to society expectations. At present, two of the most studied aspects are the ethical and sustainable behaviours of organisations. These aspects are related to the characteristics of boards of directors, especially to external directors. Independent directors may disagree with disclosing information about CSR practices because they fear that this information would affect their professional reputations, since they are not specialised in these topics. However, proprietary directors favour the disclosure of this information in an attempt to reduce the cost of capital and risk perceived by investors, especially in more sustainable companies.
Jurnal Kajian Akuntansi dan Auditing; doi:10.37301/jkaa.v0i0.5127
This study aims to determine the influence of company characteristics and disclosure practices of corporate governance to corporate sustainability report on manufacturing in Indonesia Stock Exchange. In this study the sample was 48 companies manufacturing in Indonesia Stock Exchange. Type of data used secondary adala obtained from the Indonesian Capital Market of Directory (ICMD) and the Annual Report. Observation period is used of the year 2006 to 2010. In this study the researchers classifying the research variables menjad two main groups. The first independent variable consisting of leverage, aktitas ratio, firm size, firm age and the audit committee. The second is the dependent variable is the practice of sustainability disclosure report. The method used is a quantitative analysis that is processed by using the method of quantitative analysis. Based on the results of hypothesis testing study found that each used variable is leverage, activity ratio, firm size, firm age and the audit committee had no significant effect on the sustainability report disclosure practices of manufacturing firms in Indonesia Stock Exchange.
Published: 1 January 2004
This paper studies the extent to which present annual reporting practices fulfill the themes of comprehensive business reporting put forth by the Jenkin’s Report and a series of authoritative reports that have emerged in its wake, and thereby examines which types of information suppliers find relevant. In this paper, a content analysis of the annual reports of all the listed companies in the Danish biotech, pharmaceutical and medicotech industry from the fiscal year 2002/03 is conducted. The sample thus includes 13 companies. The empirical analysis uncovers the characteristics of the information that companies voluntarily supply to the capital market in their annual reports. The findings support the cost of disclosure theory, as a strong correlation between disclosure and market capitalization is found. Especially disclosures of corporate governance metrics and social and sustainability disclosures were significantly correlated with firm size. The overall findings indicate an overweight of context-building and branding-related information in the annual reports, suggesting that annual reporting plays a central role in legitimizing the company’s existence and that their content is driven by appropriate corporate action. The analysis confirms that there is a lack of disclosure of forward-oriented types of information which are comparable over time like e.g. value drivers, critical success factors as well as non-financial information. Finally, awareness towards and disclosure of information concerning the effects of voluntary disclosure were found to be non-existent.