Type Of Board And Sustainability Reporting

Abstract

The research examined the relationship between BODT (board of director type) and CSR (corporate sustainability reporting), annual report disclosure and performance by using a sampling of companies listed on the S&P 500 for 2015. The data came from annual reports filed with the U.S. Securities and Exchange Commission and the Global Reporting Initiative. The study considered the relationship between BODT with emphasis on CEO (Chief Executive officer)-only and non-CEO-only boards and corporate sustainability reporting. Past research has found the CEO-only board relates to lower corporate performance and has seen significant use since the advent of the Sarbanes-Oxley Law that required boards that are more independent. The CEO-only board is an elaboration of an independent board or directors, whose only management member of the board is the CEO. The study used CEO-duality, another powerful influencer of boards, as a theoretical proxy for the CEO-only board. Regulators and investors are demanding higher level CSR reporting and information; therefore, the findings are of interest to both companies considering board of director type and regulators and investors. The quantitative categorical research study found a significant relationship between CEO-only boards and higher levels of disclosure and reporting. No significant relationship between CEO-only board and greater ROA was found. A possible reason for the differences in outcomes between the past research regarding independent boards that did not consider the CEO-only member and CSR reporting and the research presented in this study was the role of the lead independent director as a member of the CEO-only board not considered in this study.