Open AccessThe Influence of Corporate Governance on the Environmental Information Disclosure of MNCs: An Empirical Study on Corporations from China, Japan, the United Kingdom and the United States
Author(s) -
Chenqi Li,
Xuhui Peng
Publication year - 2022
Publication title -
research in economics and management
Language(s) - English
Resource type - Journals
eISSN - 2470-4407
pISSN - 2470-4393
DOI - 10.22158/rem.v7n1p49
Subject(s) - accounting , multinational corporation , business , corporate governance , china , corporate social responsibility , transparency (behavior) , empirical research , public relations , political science , finance , law , philosophy , epistemology
As one of the ways for multinational companies to obtain the advantages of sustainable development, corporate social responsibility (CSR) has been widely recognized by the academic community. Research featuring the influence of corporate governance (CG) on the environmental information disclosure of multinational corporations (MNCs) have gained much attention, but there is a lack of research into the empirical examination of cross-national samples. Drawing on Agency Theory, this study fills the gap by making a theoretical exploration and empirical test on relationships between CG and MNCs’s environmental disclosure. Board independence, board size, board meeting frequency and their relationships to the environmental disclosure of MNCs are observed in this study. In order to examine the aforementioned relationships, this study incorporates measurement techniques used by Van Staden and Hooks (2007) [1] and Global Reporting Initiative 4.0 guideline (GRI4.0) and develops a set of comprehensive, systematic measurement standards to appraise the environmental information disclosure of corporations. The content analysis method is used to assess the environmental disclosure of 151 companies from China, the United States, Japan, and the United Kingdom, according to Forbes Global 2000 Ranking in 2019. We find that board independence, the board size, and the frequency of board meetings are all positively associated with the environmental disclosure of MNCs. This finding indicates that more independent boards of directors, larger boards, and more frequent board meetings are CG mechanisms which lower the likelihood for an opportunistic behaviour and increase information transparency and voluntary implementation of the disclosure, effectively enhancing the environmental disclosure of MNCs. This impact of CG on corporations’ environmental information disclosure exists across country contexts.