Advancing Sustainable Development Goal 15: The Role of Corporate Governance Structures and Environmental Regulations in Emerging Economies

Abstract

This study advances the literature on sustainable development, corporate governance, and environmental management by examining the interplay between governance structures (GS) and biodiversity disclosure (BD) in alignment with Sustainable Development Goal 15. Grounded in institutional, legitimacy, and stakeholder theories, we investigate how various GS influence firms' commitment to biodiversity reporting in sub‐Saharan Africa, while also considering the moderating role of environmental regulations. Utilizing panel data from 386 environmentally sensitive manufacturing firms between 2010 and 2022, we employ the two‐step system generalized method of moments (GMM) modeling, as proposed by Blundell and Bond and addressed potential endogeneity issues through instrumental variable two‐stage least squares (IV‐2SLS), propensity score matching, and lagged effect estimations. Our findings reveal that board diversity, particularly gender diversity and the presence of foreign nationals, positively impacts BD. Additionally, structural attributes such as board size and independence enhance BD, while CEO duality negatively affects this outcome. Furthermore, a positive relationship is observed between the frequency of board meetings and BD, yet a negative association exists with meeting attendance. Notably, environmental regulations not only increase BD, but significantly enhance the effect of GS on BD. These findings provide valuable insights for policymakers and stakeholders, contributing to the discourse on Sustainable Development Goal 15 by advocating for stronger governance frameworks to bolster biodiversity conservation and environmental stewardship in emerging economies.