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

Abstract

Purpose

This study aims to investigate the impact of corporate governance structures on environmental disclosure practices in the Middle East and Africa (MEA).

Design/methodology/approach

The research model uses a panel data set of 121 publicly listed (non-financial and non-utility) firms from 11 MEA countries over the period 2010-2017, uses 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. 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 women 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.

Citation

Kilincarslan, E., Elmagrhi, M.H. and Li, Z. (2020), "Impact of governance structures on environmental disclosures in the Middle East and Africa", Corporate Governance, Vol. 20 No. 4, pp. 739-763. https://doi.org/10.1108/CG-08-2019-0250