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Board composition, sustainability committee and corporate social and environmental performance in Australia

Pallab Kumar Biswas (Department of Accountancy and Finance, University of Otago, Dunedin, New Zealand)
Mansi Mansi (Department of Accountancy and Finance, University of Otago, Dunedin, New Zealand)
Rakesh Pandey (Department of Accountancy and Finance, University of Otago, Dunedin, New Zealand)

Pacific Accounting Review

ISSN: 0114-0582

Article publication date: 6 November 2018

Issue publication date: 22 November 2018

Abstract

Purpose

The purpose of this study is to examine the impacts of board gender composition, board independence and the existence of a board sustainability committee on the corporate social and environmental performance of Australian firms.

Design/methodology/approach

The dataset comprises 2,188 Australian Securities Exchange listed firm-year observations (407 individual firms) from 2004 to 2015. The ASSET4 environmental, social and governance database is used to measure corporate social and environmental performance and their sub-dimensions.

Findings

Our results show that firms with higher board gender composition, greater board independence and sustainability committees tend to have better social and environmental performance. This paper also provides empirical evidence of the positive association of these variables on the sub-dimensions of social and environmental performance. The results are robust after controlling for self-selection and various forms of endogeneity.

Originality/value

This is the first study that examines the relationship between sustainability committees and corporate social and environmental performance in the context of Australia. This study also overcomes the relatively small sample size and shorter study period issues of similar studies in Australia that provide inconclusive evidence on the relationship between each of board gender composition, board independence and corporate social and environmental performance.

Keywords

Acknowledgements

The helpful comments of two anonymous reviewers and editor Professor Asheq Rahman are greatly acknowledged.

Citation

Biswas, P.K., Mansi, M. and Pandey, R. (2018), "Board composition, sustainability committee and corporate social and environmental performance in Australia", Pacific Accounting Review, Vol. 30 No. 4, pp. 517-540. https://doi.org/10.1108/PAR-12-2017-0107

Publisher

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Emerald Publishing Limited

Copyright © 2018, Emerald Publishing Limited