Antecedents of Voluntary Corporate Governance Disclosure: A Post-2007/08 Financial Crisis Evidence from the Influential UK Combined Code

Purpose: This study investigates the level of compliance with, and disclosure of, good corporate governance (CG) practices among UK publicly listed firms, and consequently ascertains whether board characteristics and ownership structure variables can explain observable differences in the extent of voluntary CG compliance and disclosure practices. Design/Methodology/Approach: The study uses one of the largest datasets to-date on compliance and disclosure of CG practices from 2008 to 2013 containing 120 CG provisions drawn from the 2010 UK Combined Code relating to 100 UK listed firms to conduct multiple regression analyses of the determinants of voluntary CG disclosures. A number of additional estimations, including two stage least squares, fixed-effects and lagged structures, are conducted in order to test the robustness of the findings. Findings: The results suggest that there is a substantial variation in the levels of compliance with, and disclosure of, good CG practices among the sampled UK firms. We also find that firms with larger board size, more independent outside directors and greater director diversity tend to disclose more CG information voluntarily, whereas the level of voluntary CG compliance and disclosure is insignificantly related to the existence of a separate CG committee and institutional ownership. Additionally, the results indicate that block ownership and managerial ownership impact negatively on voluntary CG compliance and disclosure practices. The findings are fairly robust across a number of econometric models that sufficiently address various endogeneity problems and alternative CG indices. Overall, the findings are generally consistent with the predictions of neo-institutional theory. Originality/Value: This paper extends, as well as contributes to the extant CG literature by offering new evidence on compliance with, and disclosure of, good CG recommendations contained in the 2010 UK Combined Code following the 2007/08 global financial crisis. This paper also advances the existing literature by offering new insights from a neo-institutional theoretical perspective of the impact of board and ownership mechanisms on voluntary CG compliance and disclosure practices. Keywords: Corporate governance; Board and ownership mechanisms; Comply or explain; Neo-institutional theory; UK Combined Cod

Impact of governance structures on environmental disclosures in the Middle East and Africa

Purpose – This study investigates the impact of corporate governance structures on environmental disclosure practices in the Middle East and Africa. Design/methodology/approach – The research model uses a panel dataset of 121 publicly listed (non-financial and non-utility) firms from 11 Middle East and African (MEA) countries over the period 2010–2017, employs alternative dependent variables and regression techniques, and is applied to various sub-groups to improve robustness. Findings – The empirical results strongly indicate that MEA firms with high governance disclosures tend to have better environmental disclosure practices. The board characteristics of gender diversity, size, CEO/chairperson duality and audit committee size impact positively on MEA firms’ voluntary environmental disclosures, whereas board independence has a negative influence. Research limitations/implications – This study advances research on the relationship between corporate governance structures and environmental disclosure practices in MEA countries, but is limited to firms for which data are available from Bloomberg. Practical implications – The results have important practical implications for MEA policymakers and regulators. Given the positive impact of board gender diversity on firms’ environmental disclosures, policy reforms should aim to increase female directors. MEA corporations aiming to be more environmentally friendly should recruit females to top managerial positions. Originality value – This is thought to be the first study to provide insights from the efficiency and legitimation perspectives of neo-institutional theory to explain the relationship between MEA firms’ internal governance structures and environmental disclosures

Environmental performance, sustainability, governance and financial performance: Evidence from heavily polluting industries in China

This study seeks to contribute to the existing business strategy and the environment literature by examining the effect of governance structures on Chinese firms’ environmental performance, and consequently ascertain the extent to which the financial performance–environmental performance nexus is moderated by governance mechanisms. Using a sample of Chinese companies from heavily-polluting industries over a five-year period, our baseline findings suggest that, on average, board size and governing board meetings are positively associated with Chinese firms’ environmental performance, whilst board independence and gender diversity have positive, but insignificant association with firms’ environmental performance. Our evidence suggests further that the examined internal governance mechanisms have a mixed moderating effect on the link between financial performance and environmental performance. Our findings have important implications for company executives, environmental activists, policy-makers, and regulators. Our results support insights drawn from agency, resource dependence, stakeholder, and legitimacy theories

Sustainability and legitimacy theory: The case of sustainable social and environmental practices of small and medium‐sized enterprises

The aim of this paper is to identify and gain insights into small and medium-sized enterprises’ (SMEs) rationales (‘why’) for engaging in sustainable social and environmental practices (SEPs) that influence social and environmental policy and sustainability changes. Specifically, we depart from the predominately quantitative-orientated SEPs literature by conducting in-depth interviews and analysis of owners and managers of SMEs in the UK within a legitimacy theoretical framework. Our findings from a comprehensive number of interviewees show that SMEs employ a complex mix of both symbolic and substantive SEPs with the aim of enhancing the legitimacy and sustainability of their operations. The results emphasise the strengths of social engagement, reputation and image, environmental embeddedness, industry differentiation and education facilitators. In particular, the paper shows that legitimating strategies can have a dual purpose of being symbolic in nature, but also inferring a substantive legitimacy claim. Evidence of SMEs maintaining their legitimacy position stretches further via either a moral and/or a pragmatic standpoint

CSR, financial and non-financial performance in the tourism sector::A systematic literature review and future research agenda

This paper provides a comprehensive, international, multi-discipline and multi-methods systematic literature review (SLR) of the existing corporate social responsibility (CSR) and corporate financial performance and non-financial performance measures research in tourism firms. The objective is to synthesise, appraise and extend current understanding of the existing conceptual/theoretical/empirical literature on the relationship between CSR and corporate financial and non-financial performance measures. We adopt a three-step SLR approach to analyse/review one of the largest SLR datasets employed to-date, consisting of 140 multi-methods and theoretical CSR studies conducted globally across multiple disciplines over the 2004–2019 period, published in top ranked journals. Our findings are as follows. First, a large number of the existing studies are descriptive and/or draw on single rather than multi-theoretical perspectives. Second, existing studies have focused mainly on how CSR is related to financial performance measures to the neglect of non-financial performance measures. Third, observable methodological limitations include the dearth of qualitative, mixed-methods and cross-cultural/ developing/country studies. Finally, we outline opportunities for future research

Female Audit Partners and Extended Audit Reporting: UK Evidence

This study investigates whether audit partner gender is associated with the extent of auditor disclosure and the communication style regarding risks of material misstatements that are classified as key audit matters (KAMs). Using a sample of UK firms during the 2013–2017 period, our results suggest that female audit partners are more likely than male audit partners to disclose more KAMs with more details after controlling for both client and audit firm attributes. Furthermore, female audit partners are found to use a less optimistic tone and provide less readable audit reports, compared to their male counterparts, suggesting that behavioural variances between female and male audit partners may have significant implications on their writing style. Therefore, this study offers new insights on the role of audit partner gender in extended audit reporting. Our findings have important implications for audit firms, investors, policymakers and governments in relation to the development, implementation and enforcement of gender diversity

Non-financial reporting in non-profit organisations: the case of risk and governance disclosures in UK higher education institutions

This paper investigates non-financial reporting in non-profit organisations. Specifically, it examines the extent to which UK higher education institutions (HEIs) make voluntary disclosures relating to risk management practices, and investigates whether composite governance quality index and senior management team characteristics can influence such risk disclosures. Using a sample of UK HEIs over a number of years and drawing insights from neo-institutional theory, our findings are three-fold. First, our baseline findings contribute to the literature by showing that the level of risk disclosure among HEIs in the UK is relatively low, especially when compared to the findings of prior studies that have been conducted on similar-sized publicly traded corporations. Second, we contribute to the literature by providing timely evidence on the impact of governance quality on risk disclosure. In particular, our evidence contributes to the existing literature by demonstrating that better-governed HEIs tend to engage in higher risk disclosures than their poorly-governed counterparts. Finally, our study contributes to the extant literature by providing new evidence that offers support for the “shared” governance model among UK HEIs. Specifically, our findings show that the positive governance quality–risk disclosure relationship is moderated/explained largely by the characteristics of the senior management team. Our findings are robust to controlling for endogeneities and alternative estimation techniques, with major implications for non-financial reporting

Vice-chancellor pay and performance: The moderating effect of vice-chancellor characteristics

This paper investigates the association between UK higher education institutions (HEIs) long- and short-term performance measures, and the pay of vice-chancellors/principals (VCs) in an era of intense neoliberalism/financialisation of HEIs, and consequently ascertains the extent to which the VC pay–performance nexus is moderated by VC characteristics. Using a longitudinal sample of UK HEIs, our baseline findings suggest that HEIs that prioritise meeting long-term social performance targets tend to pay their VCs low pay packages, whilst HEIs that focus on achieving short-term reputational performance targets pay their VCs high pay packages. We show further that the VC pay–performance relationship is moderated/explained largely by VC characteristics. Our findings are robust to controlling for alternative governance mechanisms, endogeneities, alternative performance measures and different estimation techniques. Our findings offer empirical support for optimal contracting and prestige theories with significant implications for the sector. Keywords: Vice-Chancellor/Principal pay, Performance, Vice-Chancellor/Principal characteristics, Governance, Financialisation/Neoliberalism, HEIs, Prestige theory, UK <br/

sj-docx-1-wes-10.1177_09500170221111366 – Supplemental material for Vice-Chancellor Pay and Performance: The Moderating Effect of Vice-Chancellor Characteristics

Supplemental material, sj-docx-1-wes-10.1177_09500170221111366 for Vice-Chancellor Pay and Performance: The Moderating Effect of Vice-Chancellor Characteristics by Mohamed H Elmagrhi and Collins G Ntim in Work, Employment and Society</p

Environmental management practices and financial performance using data envelopment analysis in Japan: The mediating role of environmental performance

This study investigates the relationship between environmental management practices (EMPs) and financial performance (FP), and consequently ascertain whether environmental performance (EP) can mediate the EMPs–FP nexus. Distinctly using data envelopment analysis and generalised method of moments techniques to analyse a comprehensive dataset of Nikkei 225 listed firms from 2007 to 2018 (1,920 firm-year observations), our findings first suggest that EMPs have a positive effect on FP. Second, the desired EP can be achieved through the adoption of comprehensive EMPs. Third, improved EP has a substantial impact on shaping the EMPs’ effect on FP. These findings are consistent with the predictions of resource-based view and institutional theories. The results are robust to controlling for different types of alternative measures and endogeneities. The findings have important implications for academics, investors, managers, policy-makers, and regulators