ESG disclosure and firm performance before and after IR: The moderating role of governance mechanisms

Purpose This paper aims to investigate the effect of environmental, social, and governance disclosure (ESGD) on firm performance (FP) before and after the introduction of integrated reporting (IR) further to exploring a potential moderation effect of corporate governance (CG) mechanisms on this relationship. Design/methodology/approach Ordinary least squares (OLS) and firm-fixed effects models were estimated based on data related to FTSE 350 between 2009 and 2018. The data has been mainly collected from Bloomberg and Capital IQ. This analysis was supplemented with applying a two-stage least squares (2 SLS) model to address any concerns regarding the expected occurrence of endogeneity problems. Findings The results show a positive and significant relationship between ESGD score and firm performance before and after 2013, among a sample of FTSE 350. Furthermore, the study is suggestive of a moderation effect of CG mechanisms (i.e., ownership concentration, gender diversity and board size) on the ESGD-FP nexus. Additionally, this paper finds that firms voluntarily associated with IR have a tendency to achieve better firm financial performance. Practical implications The findings of the present study have several policy and practitioner implications. For example, managers may engage in ESGD to enhance their firms’ financial performance by the voluntary involvement in IR, which believed to help investors to rationalise their investment decisions. Likewise, the results reiterate the crucial need to integrate more social, environmental and economic regulations to promote sustainability in the UK. The paper also offers a systematic picture for policymakers in the UK as well as future researchers. Social implications The findings of this paper indicate that IR plays a significant role in the relationship between ESGD and FP, where IR firms seemed to be achieving better FP as compared with their nonIR counterparts. This implies that stakeholders may have played a magnificent effort to encourage firms’ voluntary engagement in IR in the UK. Originality/value To the best of the authors’ knowledge, this is the first study to explore the potential moderating effect of ownership concentration, gender diversity and board size on the relationship between ESGD and FP and to examine whether firms’ voluntary involvement in IR can lead to better FP after the introduction of IR in 2013 in the UK

Is corporate environmental disclosure associated with firm value? A multi-country study of Gulf Cooperation Council firms

The file attached to this record is the author's final peer reviewed version. The Publisher's final version can be found by following the DOI link.open access articleSeveral studies have found a relationship between corporate social and environmental disclosure and firm value or accounting profitability. Where environmental disclosure has been the focus, though, only single-country studies have been published; and most of the previous research concerns the developed world. This study examines the association between corporate environmental disclosure (CED) and firm value (FV) in the Gulf Cooperation Council (GCC) countries, where CED has been increasing from its previous low base. Findings from a multi-country sample of 500 firm-year observations using a 55-item unweighted environmental disclosure index suggest that CED is significantly and positively related to FV as measured by Tobin’s Q (TBQ). The relationship is robust to using a weighted version of the disclosure index, individual countries and environmental disclosure sub-indices. Some evidence of a positive relationship between CED and return on assets (ROA) is also found, but even where statistically significant, the relationship is much weaker than in the case of TBQ. For empirical and theoretical reasons, we recommend that future studies pay greater attention to market-based proxies, if possible when investigating the value relevance of CED in both developed and developing countries. Our results suggest that both managers and policymakers in GCC countries should take a positive view of expanded CED

Did Corporate Governance Compliance Have an Impact on Auditor Selection and Quality? Evidence From FTSE 350

The file attached to this record is the author's final peer reviewed version. The Publisher's final version can be found by following the DOI link.This paper examines the possible effects of corporate governance (GC) on audit quality (AQ) among the FTSE 350 companies. Using a sample of 180 companies from 2012 to 2017 (i.e., 1080 firm-year observations) a binary logistic model has been employed to investigate the CG-AQ nexus. This analysis was supported by conducting a probit logistic model as a sensitivity analysis. Our findings are associative of a heterogeneous impact of CG on AQ post the implementation of the 2012 CG reforms in the UK. For example, although institutional ownership and management ownership are positively associated with auditor selection and AQ, board independence, non-executive directors and audit committee are not attributed to AQ in the UK. This implies that corporate compliance with good CG practices has a limited impact on the decision to select a Big4 auditor in the UK. Despite the limitations of our study, we hope it can motivate further investigations in this area

Engendering pro-sustainable performance through a multi-layered gender diversity criterion: evidence from the hospitality and tourism sector

This study seeks to examine the influence of multi-layered gender diversity mechanisms on firms’ decision to engage in pro-sustainable performance in the context of Hospitality and Tourism (H&T) firms worldwide. Using Powell's (2016) Panel Quantile Regression (PQR) model, this paper finds that females on boards and sub-boards tend to display a more communal, participative, and democratic leadership style, demonstrating greater responsibilities towards stakeholders' concerns and engaging with sustainability strategies to make a positive contribution to society. Our findings also reaffirm that women on the boards of H&T firms are more community-oriented and philanthropically driven than women in senior management positions who can be perceived as being profit-oriented rather than stakeholder-oriented as managers. Our results offer implications for policymakers and practitioners, and we suggest several avenues for future studies that could build upon our research

Digital financial inclusion in emerging economies: evidence from Jordan

This study explores the role of digital financial inclusion in mitigating poverty and bolstering economic growth, with a special focus on developing nations during the COVID-19 era. Centering on Jordan, it seeks to identify key influencers of financial access by analyzing data from 260 participants using a non-linear probit regression model. The research uncovers a significant disparity in financial inclusion between Jordanian adult males and females, attributable to differences in education, wealth, employment, and income levels. These findings point to the necessity of prioritizing financial accessibility for marginalized groups such as women, the elderly, and those with lower income to effectively combat poverty and facilitate economic advancement and sustainable development in emerging markets

Is corporate environmental disclosure associated with firm value? A multicountry study of Gulf Cooperation Council firms

Several studies have found a relationship between corporate social and environmental disclosure and firm value (FV) or accounting profitability. Where environmental disclosure has been the focus, though, only single-country studies have been published, and most of the previous research concerns the developed world. This study examines the association between corporate environmental disclosure (CED) and FV in the Gulf Cooperation Council (GCC) countries, where CED has been increasing from its previous low base. Findings from a multicountry sample of 500 firm-year observations using a 55-item unweighted environmental disclosure index suggest that CED is significantly and positively related to FV as measured by Tobin's Q (TBQ). The relationship is robust to using a weighted version of the disclosure index, individual countries and environmental disclosure subindices. Some evidence of a positive relationship between CED and return on assets is also found, but even where statistically significant, the relationship is much weaker than in the case of TBQ. For empirical and theoretical reasons, we recommend that future studies pay greater attention to market-based proxies, if possible, when investigating the value relevance of CED in both developed and developing countries. Our results suggest that both managers and policymakers in GCC countries should take a positive view of expanded CED