Sustainability reporting: explaining variance in compliance
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2019-08-19
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en
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Abstract
In the absence of extensive mandatory regulation of sustainability reporting, this study investigates whether corporate governance mechanisms exert pressure on organizations to comply with generally accepted sustainability reporting guidelines. These guidelines were developed to increase the quality of the information in sustainability reports, however managers try to manipulate these reports and use them opportunistically. Using a panel data set of 309 listed companies during the period of 2014-2017 the results indicate a positive relationship between board monitoring effectiveness, external assurance, media exposure, stakeholder engagement and sustainability compliance. In addition, based on an exploratory study, interaction effects were investigated to find a relationship with sustainability compliance. The results indicate that board monitoring effectiveness in combination with external assurance are positively related to sustainability compliance. Furthermore, board monitoring effectiveness in combination with sustainability compliance is also positively related. Finally, external assurance to the sustainability report in combination with higher media exposure has a positive effect on compliance to sustainability guidelines. These findings suggest that corporate governance mechanisms do exert pressure on the organization to comply more to sustainability guidelines.
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Faculteit der Managementwetenschappen