GRI guidelines in developing countries: uncovering the antecedents and consequences
Abstract
Purpose
Framed under the upper echelons theory, the purpose of this paper is to examine the effect of board characteristics on the adoption of the global reporting initiative (GRI) guidelines for corporate disclosure and, consequently, their effect on the company’s market value.
Design/methodology/approach
To achieve the research objective, the authors investigated the impact of certain important board characteristics, such as board independence, size, gender diversity and director skills. The authors examined the adoption of GRI guidelines by 371 companies based in Latin America. Using logistic regression and panel data analysis, the authors tested five hypotheses.
Findings
The findings can confirm the upper echelons theory, showing that directors have an important role in determining environmental policies and strategies in their companies. The authors confirm that three characteristics affect GRI adoption in Latin America: independence, gender diversity and skills of board directors. The authors also found that companies that adhere to the GRI tend to perform better in terms of market capitalization.
Practical implications
Managers who want their organization to perform better in terms of GRI disclosure must understand that characteristics such as board independence, gender diversity and directors’ skills play a significant role in the company adopting the GRI for corporate disclosure. Furthermore, managers must be aware that by adopting the GRI, the company increases its market value through market capitalization.
Originality/value
The literature is still unaware of how the adoption of GRI can bring financial returns to organizations that adopt this type of standard to disclose their corporate reports. To the best of the authors’ knowledge, this is the first empirical paper to investigate the antecedents and consequences of GRI adoption in Latin America.
Keywords
- Global Reporting Initiative
- Board of directors
- Upper echelons theory
- Board structure
- Latin America
- Global Reporting Initiative
- Directorio
- Teoría de los escalones superiores
- Estructura del directorio
- América Latina
- Global Reporting Initiative
- Conselho de administração
- Upper Echelons Theory
- Estrutura do conselho
- América Latina
- Palavras-chave Global Reporting Initiative
- Conselho de administração
- Upper Echelons Theory
- Estrutura do conselho
- América Latina
Acknowledgements
The authors would like to thank Editor Prof José Ernesto Amorós for his excellent support during the review process and three anonymous reviewers for their valuable comments. The authors are also grateful for the financial support provided by CAPES (Coordenação de Aperfeiçoamento de Pessoal de Nível Superior – Brasil).
Statements and declarations: The authors have no competing interests to declare that are relevant to the content of this article.
Citation
Pinheiro, A.B. and Ramalho, A.L.d.O.S. (2024), "GRI guidelines in developing countries: uncovering the antecedents and consequences", Management Research, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/MRJIAM-05-2024-1547
Publisher
:Emerald Publishing Limited
Copyright © 2024, Emerald Publishing Limited