Browse > Article
http://dx.doi.org/10.13106/jafeb.2021.vol8.no12.0191

The Effect of Corporate Governance on the Board of Directors' Characteristics and Sustainability Disclosure: An Empirical Study from Thailand  

JATURAT, Malee (Faculty of Business Administration, Rajamangala University of Technology Thanyaburi)
DAMPITAKSE, Kusuma (Faculty of Business Administration, Rajamangala University of Technology Thanyaburi)
KUNTONBUTR, Chanongkorn (Faculty of Business Administration, Rajamangala University of Technology Thanyaburi)
Publication Information
The Journal of Asian Finance, Economics and Business / v.8, no.12, 2021 , pp. 191-201 More about this Journal
Abstract
The objective of this research is to investigate how the board of directors' characteristics influence sustainability disclosures with the mediating effect of corporate governance. The independent variables are the characteristics of the board of directors, which consist of the presence of women on the boards, presence of directors aged over 50 years old, education level, education field, board tenure, and compensation. The dependent variable is sustainability disclosures, which is measured by the GRI standard disclosure, whereas the mediator variable is the CG score. Research samples are 460 companies listed on the Stock Exchange of Thailand (SET). Path Analysis is used to examine the correlation between the board of directors' characteristics, CG score, and GRI standard disclosure. The research findings show that senior boards, the education field, and compensation motivation have an effect on sustainability disclosures, whereas corporate governance is a mediator of the effect of the education field of boards on sustainability disclosures. This finding should help shareholders to choose individuals with suitable characteristics to serve on the board of directors, and, as a result, shareholders should anticipate a profitable result to be generated, while the business of the company is conducted in a sustainable way.
Keywords
Board of Directors' Characteristics; Sustainability Disclosures; Corporate Governance; GRI Standard;
Citations & Related Records
연도 인용수 순위
  • Reference
1 Hassan, R., Marimuthu, M., & Kaur Johl, S. (2016). Women on boards and market performance: An exploratory study on the listed companies. International Business Management, 10(2), 84-91. https://doi.org/10.36478/ibm.2016.84.91   DOI
2 Shamil, M. M., Shaikh, J. M., Ho, P.-L., & Krishnan, A. (2014). The influence of board characteristics on sustainability reporting: empirical evidence from Sri Lankan firms. Asian Review of Accounting, 22(2), 78-97. https://doi.org/10.1108/ARA-09-2013-0060   DOI
3 Tran, Q. T., Lam, T. T., & Luu, C. D. (2020). Effect of corporate governance on corporate social responsibility disclosure: empirical evidence from Vietnamese commercial banks. The Journal of Asian Finance, Economics, and Business, 7(11), 327-333. https://doi.org/10.13106/jafeb.2020.vol7.no11.327   DOI
4 Tulung, J. E., & Ramdani, D. (2016). The influence of top management team characteristics on BPD performance. International Research Journal of Business Studies, 8(3), 155-166. https://doi.org/10.21632/irjbs.8.3.155-166   DOI
5 Ullah, M. S., Muttakin, M. B., & Khan, A. (2019). Corporate governance and corporate social responsibility disclosures in insurance companies. International Journal of Accounting & Information Management, 27(2), 284-300. https://doi.org/10.1108/IJAIM-10-2017-0120   DOI
6 Yahya, F., & Ghazali, Z. B. (2017). Effectiveness of board governance and dividend policy as alignment mechanisms to firm performance and CEO compensation. Cogent Business & Management, 4(1), 1-20. https://doi.org/10.1080/23311975.2017.1398124   DOI
7 Zaidi, N., Azouzi, M. A., & Sadraoui, T. (2021). CEO financial edcuation and bank performance. Journal of Entrepreneurship Education, 24(2), 1-20. https://www.abacademies.org/abstract/ceo-financial-education-and-bank-performance-10221.html
8 Beji, R., Yousfi, O., Loukil, N., & Omri, A. (2020). Board diversity and corporate social responsibility: Empirical evidence from France. Journal of business ethics, 2(5), 1-23. https://doi.org/10.1007/s10551-020-04522-4   DOI
9 Post, C., Rahman, N., & McQuillen, C. (2015). From board composition to corporate environmental performance through sustainability-themed alliances. Journal of Business Ethics, 130(2), 423-435. https://www.jstor.org/stable/24703477   DOI
10 Zhang, L. (2012). Board demographic diversity, independence, and corporate social performance. Corporate Governance: The International Journal of Business in Society, 12(5), 686-700. https://doi.org/10.1108/14720701211275604   DOI
11 Berglund, T. (2020). Liquidity and corporate governance. Journal of Risk and Financial Management, 13(3), 54. https://doi.org/10.3390/jrfm13030054   DOI
12 Herli, M., Tjahjadi, B., & Hafidhah, H. (2021). Gender diversity on board of directors and intellectual capital disclosure in Indonesia. The Journal of Asian Finance, Economics, and Business, 8(1), 135-144. https://doi.org/10.13106/jafeb.2021.vol8.no1.135   DOI
13 Danoshana, S., & Ravivathani, T. (2019). The impact of the corporate governance on firm performance: A study on financial institutions in Sri Lanka. SAARJ Journal on Banking & Insurance Research, 8(1), 62-67. https://meritresearchjournals.org/aaef/Content/2013/December/Danoshana%20and%20Ravivathani.pdf   DOI
14 Ouma, C. A., & Webi, R. Y. (2017). Effect of age diversity of board members on the performance of non-governmental organizations in Kenya. International Journal of Novel Research in Marketing Management and Economics, 4(2), 101-123. http://erepo.usiu.ac.ke/bitstream/handle/11732/3376
15 Garcia-Blandon, J., Argiles-Bosch, J. M., & Ravenda, D. (2019). Exploring the relationship between CEO characteristics and performance. Journal of Business Economics and Management, 20(6), 1064-1082. https://doi.org/10.3846/jbem.2019.10447   DOI
16 Giannarakis, G. (2014). The determinants influencing the extent of CSR disclosure. International Journal of Law and Management, 56(5), 393-416. https://doi.org/10.1108/IJLMA-05-2013-0021   DOI
17 Hambrick, D. C., & Mason, P. A. (1984). Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9(2), 193-206. https://doi.org/10.2307/258434   DOI
18 Huang, S. K. (2013). The impact of CEO characteristics on corporate sustainable development. Corporate Social Responsibility and Environmental Management, 20(4), 234-244. https://doi.org/10.1002/csr.1295   DOI
19 Hussain, N., Rigoni, U., & Orij, R. P. (2018). Corporate governance and sustainability performance: Analysis of triple bottom line performance. Journal of Business Ethics, 149(2), 411-432. https://doi.org/10.1007%2Fs10551-016-3099-5   DOI
20 Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs, and ownership structure. Journal of Financial Economics, 3(4), 305-360. https://doi.org/10.1016/0304-405X(76)90026-X   DOI
21 Kouaib, A., Mhiri, S., & Jarboui, A. (2020). Board of directors' effectiveness and sustainable performance: The triple bottom line. The Journal of High Technology Management Research, 31(2), 100390. https://doi.org/10.1016/j.hitech.2020.100390   DOI
22 Salvioni, D. M., Franzoni, S., & Gennari, F. (2016). Corporate governance systems and sustainability: CSR as a factor of convergence between outsider and insider systems. Corporate Ownership and Control, 14(1), 139-150. https://doi.org/10.1504/IJBPM.2018.088490   DOI
23 Setyahadi, R. R., & Narsa, I. (2020). Corporate Governance and Sustainability in Indonesia. The Journal of Asian Finance, Economics, and Business, 7(12), 885-894. https://doi.org/10.13106/jafeb.2020.vol7.no12.885   DOI
24 Buachoom, W. (2017). Simultaneous relationship between performance and executive compensation of Thai non-financial firms. Asian Review of Accounting, 25(3), 404-423. https://doi.org/10.1108/ARA-02-2016-002010.1080/23311975.2017.1398124   DOI
25 Crifo, P., Escrig-Olmedo, E., & Mottis, N. (2019). Corporate governance as a key driver of corporate sustainability in France: The role of board members and investor relations. Journal of Business Ethics, 159(4), 1127-1146. https://doi.org/10.1007%2Fs10551-018-3866-6   DOI
26 Jizi, M. I., Salama, A., Dixon, R., & Stratling, R. (2014). Corporate governance and corporate social responsibility disclosure: Evidence from the US banking sector. Journal of Business Ethics, 125(4), 601-615. https://doi.org/10.1007/s10551-013-1929-2   DOI
27 Joseph, F., Barry, J. B., Rolph, E. A., & Rolph, E. A. (2010). Multivariate data analysis. London, UK: Pearson Prentice Hall.
28 Kline, R. B. (2015). Principles and practice of structural equation modeling. USA: Guilford Publications.
29 Loh, L., Thomas, T., Lee, S., Lim, L., Pan, H., Malek, M., & Wynne, R. (2018). Sustainability reporting in ASEAN countries. https://www.asean-csr-network.org/c/images/Resources/Reports/2018_Sustainability_Reporting_in_ASEAN_Countries.pdf
30 McFarland, D. E. (1979). Management: Foundations and practices. New York: Macmillan Publishing Company.
31 Rose, C. (2016). Firm performance and compliance or explain disclosure in corporate governance. European Management Journal, 34(3), 202-222. https://doi.org/10.1016/j.emj.2016.03.003   DOI
32 Panda, B., & Leepsa, N. (2017). Agency theory: Review of theory and evidence on problems and perspectives. Indian Journal of Corporate Governance, 10(1), 74-95. https://doi.org/10.1177/0974686217701467   DOI