Corporate governance and sustainability disclosure: evidence from Jordan

Abstract

Purpose This paper aims to examine the impact of corporate governance (CG) on sustainability disclosure (SD) from the perspectives of resource dependence, agency and stakeholder theories in the context of Jordan. Design/methodology/approach The analyses were based on 405 observations from non-financial firms listed on the Amman Stock Exchange, spanning the period of 2014–2018. The CG that influences SD was examined using panel data regression models. Findings The results of the current study show a positive and significant relationship between the extent of SG and the audit committee and board of directors’ effectiveness. In terms of ownership structure, both institutional and foreign ownerships yielded an insignificant relationship with the extent of SDs. Practical implications The analyses have implications for practitioners, policymakers, top management and corporate executives. Firms are encouraged to restructure their board of directors to enhance the effectiveness of the board to better monitor and support better SD. Originality/value To the best of the authors’ knowledge, this is the first study to examine the determinants of SD in Jordan firms. This paper adopted a newly developed global reporting initiative-based reporting index that identifies companies with good sustainability practices. This adds value to the existing sustainability literature.

Board gender diversity and firm performance: The mediating role of sustainability disclosure

“…The sample population comprised of the non-financial firms publicly listed on the ASE. Firms from the financial sector were excluded due to more regulatory requirements and the difference in the governance code for financial firms (Alodat et al, 2022a(Alodat et al, , 2022b(Alodat et al, , 2022c. Due to the release of the code of corporate governance for listed shareholders (currently known as the ASE code) in 2009 and the most recent and complete data available at the time the study was conducted, a study period covering the years 2014 through 2018 was chosen.…”

“…Firms may implement sustainability practices to attract stakeholders (Deegan & Blomquist, 2006). Meeting the expectations of different stakeholders is still a great challenge for firms and management must pay attention to it because it helps the firm to survive (Alodat et al, 2022a(Alodat et al, , 2022b(Alodat et al, , 2022c.…”

“…Moreover, the sustainable development and long‐term survival of any firms need stakeholder support which explained by stakeholder theory (Alodat et al, 2022a; van der Laan Smith et al, 2005). In this regard, through improved corporate reporting and transparency, such as sustainability disclosure, firms may meet stakeholder expectations and gain their support (Al Amosh & Khatib, 2022; Barako & Brown, 2008).…”

“…However, the sustainability disclosure is a voluntary initiative, and therefore the firms listed on the ASE may participate in reporting sustainability matters by including a section in the annual report or issue a report devoted to sustainability matters disclosure. Like most developing countries, ASE suffers from low level of voluntary disclosure and weak corporate governance practices (Alodat et al, 2022a(Alodat et al, , 2022cAmaeshi et al, 2016). Not all firms participate in sustainability disclosure because there are firms that do not disclose any dimensions of sustainability disclosure (Alodat et al, 2022a(Alodat et al, , 2022c.…”

“…Like most developing countries, ASE suffers from low level of voluntary disclosure and weak corporate governance practices (Alodat et al, 2022a(Alodat et al, , 2022cAmaeshi et al, 2016). Not all firms participate in sustainability disclosure because there are firms that do not disclose any dimensions of sustainability disclosure (Alodat et al, 2022a(Alodat et al, , 2022c. Therefore, it is imperative to focus on examining firm sustainability disclosure as an intermediary variable on the relationship between board gender diversity and performance of Jordanian firms.…”