Corporate governance and sustainability disclosure: evidence from Jordan

Abstract

Purpose This paper aims to examine the impact of corporate governance (CG) on sustainability disclosure (SD) from the perspectives of resource dependence, agency and stakeholder theories in the context of Jordan. Design/methodology/approach The analyses were based on 405 observations from non-financial firms listed on the Amman Stock Exchange, spanning the period of 2014–2018. The CG that influences SD was examined using panel data regression models. Findings The results of the current study show a positive and significant relationship between the extent of SG and the audit committee and board of directors’ effectiveness. In terms of ownership structure, both institutional and foreign ownerships yielded an insignificant relationship with the extent of SDs. Practical implications The analyses have implications for practitioners, policymakers, top management and corporate executives. Firms are encouraged to restructure their board of directors to enhance the effectiveness of the board to better monitor and support better SD. Originality/value To the best of the authors’ knowledge, this is the first study to examine the determinants of SD in Jordan firms. This paper adopted a newly developed global reporting initiative-based reporting index that identifies companies with good sustainability practices. This adds value to the existing sustainability literature.