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Board Diversity and Sustainability Reporting: Evidence from Industrial Goods Firms

Author

Listed:
  • Saidu Musa

    (Department of Accounting and Finance, Kwara State University, Malete, Kwara State, Nigeria)

  • Nusirat Ojuolape Gold

    (Department of Accounting and Finance, Kwara State University, Malete, Kwara State, Nigeria)

  • Hope Osayantin Aifuwa

    (Department of Accounting, Faculty of Management Sciences, University of Benin, Benin City, Edo State, Nigeria)

Abstract

The sustainable development goals (SDGs) adopted by all the United Nations member countries were to reduce the social and ecological outcome of businesses and governments across the globe, among others. Businesses can key into this agenda by disclosing their economic, environmental and social impact in their financial reports. However, in Nigeria, the extent of sustainability reporting amongst firms is still low and not a listing requirement. Against this backdrop, this study investigated the influence of a diverse board on the extent of sustainability reporting in listed industrial goods firms on the Nigerian Stock Exchange from the period 2014-2018.We developed a sustainability disclosure index using the Global Reporting Initiative (GRI) guidelines to score the information content of annual reports relating to sustainability performance. Nationality, age and educational level were used to proxy diversity in the boardroom. The study also used descriptive and inferential statistics to summarize the data and to draw an inference on the population studied. Our study failed to validate the theoretical framework - Stakeholder-Dependency Theory used in the study, as results from the panel leastsquares regression revealed that age diversity in the boardroom negatively and significantly affects the extent of sustainability reporting. Furthermore, we found no evidence on the nexus between nationality diversity and sustainability reporting; and education level diversity and sustainability reporting. The study concluded that diversity in boardroom influences the extent of sustainability reporting in Nigeria. This study recommends that firms should increase the representation of foreign directors in the boardroom because they add value and a wealth of experience to the board.

Suggested Citation

  • Saidu Musa & Nusirat Ojuolape Gold & Hope Osayantin Aifuwa, 2020. "Board Diversity and Sustainability Reporting: Evidence from Industrial Goods Firms," Business & Management Compass, University of Economics Varna, issue 4, pages 377-398.
    • Handle: RePEc:vrn:journl:y:2020:i:4:p:377-398
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    References listed on IDEAS

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    Cited by:

    1. Ladini, Mark Juliana & Associate Professor ORBUNDE, Bemshima & Dr. Daniel Emmanuel Kayode, 2024. "Effect of Board Size and Board Meeting Frequency on Environmental Disclosure of Listed Manufacturing Firms in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(1), pages 236-254, January.

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    More about this item

    Keywords

    Nationality diversity; Age diversity; Education level diversity; Sustainability Reporting; Global Reporting Initiative; Nigeria;
    All these keywords.

    JEL classification:

    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation

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