Effect of Corporate Governance on Sustainability Disclosures: Evidence from Turkey

Şerife Önder,Renat Baimurzin

doi:10.28992/ijsam.v4i1.207

Abstract

This study aims to examine the relationship between the corporate governance structure and sustainability disclosure in Turkish business. To measure the impact of the board of directors on sustainability disclosure, companies on the Istanbul Stock Exchange that prepared sustainability reports per the Global Reporting Initiative (GRI) were selected as the working sample. In this study, 68 fiscal year data sets of 17 businesses that published regular sustainability reports during 2013–2016 were used. All were audited by the GRI. During the analysis, it was observed that the presence of influential community board members and the profitability of the enterprises are factors that bear positive effects on sustainability disclosures. Board size, the presence of independent board members, and the existence of corporate social responsibility committees were negative factors that, in fact, reduced sustainability disclosures of the companies. To increase sustainability disclosures, this study suggests that boards of directors should consist of influential community leaders.

Highlights

The term “sustainable development” was coined in 1987 by the World Commission on the Environment and Development
Corporate sustainability disclosure is influenced by corporate governance; and the sustainability reports are managed by corporate governance of the enterprise (Adnan et al, 2018)
The data used in the current study were obtained after the analysis of the financial statements and sustainability reports, prepared according to the Global Reporting Initiative (GRI) standards, of enterprises publicly traded in BIST

Summary

Introduction

The term “sustainable development” was coined in 1987 by the World Commission on the Environment and Development. This notion aims to generate a society which has economic, social, and environmental goals, and can establish an appropriate balance between them. In accordance with global trends, we can observe development of sustainability disclosure in Turkey. Despite extensive research on sustainability, there are relatively few studies investigating the relationship between the board structure of the enterprise and sustainability disclosure (Janggu et al, 2014). This study focuses on investigation of the relationship between the corporate governance and sustainability disclosure (Anazonwu et al, 2018)

Objectives

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Results

Conclusion