Board characteristics and environmental disclosures: evidence from sensitive and non-sensitive industries of India

Raghu Kumari, P.S.; Makhija, Harnesh; Sharma, Dipasha; Behl, Abhishek

Abstract

Purpose
The study aims to identify the impact of board characteristics (BC) on a firm's environmental performance, and provides future research directions in the area of BC impact on environmental disclosures (ED) in case of India's environmentally sensitive and non-sensitive industries (SI and NSI).

Design/methodology/approach
The authors collect firm-level data from Prowess and Bloomberg, which cover 1,158 firm-year observations from National Stock Exchange of India (NSE) 500 listed companies from 2015 to 2020, and use a dynamic panel regression analysis to get deeper insights on the relationship of ED and BC.

Findings
The study found that lagged environment disclosure score is positively and significantly associated with current environmental disclosure scores. The presence of sustainability committee, board size and frequency of meetings has a positive and significant association with ED for sensitive as well as non-sensitive industry groups. Factors such as board Independence, board gender diversity and CEO duality have no significant impact on ED of both sensitive and non-sensitive industry groups.

Originality/value
Based on agency theory and stakeholder theory authors study for the first time in the context of India the effect of BC on ED using a large sample and covering an extensive period of six years. This study contributes by offering deep insights about the impact in case of “environmentally sensitive, non-sensitive and also all industries case”. The findings of this study are valuable for corporate managers and regulators who are interested in improving ED practices through a better-governed corporate mechanism.

Citation

Raghu Kumari, P., Makhija, H., Sharma, D., & Behl, A. (2022). Board characteristics and environmental disclosures: evidence from sensitive and non-sensitive industries of India. International Journal of Managerial Finance, 18(4), https://doi.org/10.1108/IJMF-10-2021-0547

• Journal Article Type: Article
• Acceptance Date: Mar 24, 2022
• Online Publication Date: Apr 26, 2022
• Publication Date: Jul 12, 2022
• Deposit Date: Aug 21, 2024
• Journal: International Journal of Managerial Finance
• Print ISSN: 1743-9132
• Publisher: Emerald
• Peer Reviewed: Peer Reviewed
• Volume: 18
• Issue: 4
• DOI: https://doi.org/10.1108/IJMF-10-2021-0547
• Public URL: https://keele-repository.worktribe.com/output/856308