Determinants of environmental disclosure: investigating new and conventional corporate governance characteristics

This study investigated corporate governance factors that could shape the decision for sustainability reporting. Specifically, this paper sets out to investigate the environmentally sensitive properties of distinct corporate governance characteristics vis-a-vis sustainable concerns strengthening the decision to develop environmental disclosures. Regarding explanatory variables, the study focused on corporate governance because it sets the rules and processes by which a firm is managed. Five plausible individual characteristics were employed in our proposed model, namely, "Independent Directors", "presence of Lead Independent Director", "frequency of Audit Committee Meetings", "presence of Sustainable Committee", and the "Age of the Youngest Director". We utilized the Environmental facet of Environmental, Social and Governance score calculated by Bloomberg as a proxy driving the decision to disseminate environmental information. Hypotheses were tested using a Logit model for a sample of a total of 278 firms from the United States listed S&P 500. Results revealed that the "Age of the Youngest Director" has a negative effect, while "Independent Directors" and the "presence of Lead Independent Director" variables seem to strengthen the decision to develop environmental disclosures. Implications are valuable to different stakeholders and policy makers interested in improving corporate governance initiatives to reducing agency costs and enhancing corporate sustainable transparency.