Corporate governance perspective on environmental reporting: Literature review and future research agenda

Abstract

The last three decades have witnessed substantial growth in the literature exploring the motives and drivers of corporate greening. Extant research analyzing the governance determinants of corporate environmental disclosure provides competing and contrasting results; despite the growing sustainability challenges create an urgent need for effective monitoring and incentive mechanisms to promote corporate transparency and accountability. This warrants further inquiry in the field, yet very few comprehensive reviews have been presented on governance determinants of corporate environmental disclosure. To fill this gap we conduct a systematic review of 121 published papers and distinguish the governance mechanisms fostering corporate environmental disclosure. Our paper identifies factors influencing the adoption, extant, and quality of environmental disclosure, and provides useful future research directions.

Analyzing the impact of environmental strategies on corporate governance and long-term performance

“…Sutantoputra (2021) underscores the pivotal role of stakeholder pressure as a critical moderator, with stakeholder demands exerting considerable influence on the extent of environmental disclosure. This observation aligns with Aluchna et al's (2023) call for further exploration into "the moderating effects of governance mechanisms" on the effectiveness of environmental policies. From this perspective, robust corporate governance, encompassing board composition, stakeholder engagement, and ethical standards, may amplify the positive impact of environmental initiatives on long-term performance.…”

“…Notable studies by Overell (2007), Yook (2016), Sutantoputra et al ( 2012), and Doan & Sassen (2020) reveal a positive correlation between environmental disclosure and performance, suggesting that transparency fosters enhanced environmental practices. However, Aluchna et al (2023) caution that the phenomenon of greenwashing or manipulation of environmental reporting can potentially undermine the anticipated benefits. Sutantoputra (2021) underscores the pivotal role of stakeholder pressure as a critical moderator, with stakeholder demands exerting considerable influence on the extent of environmental disclosure.…”

“…Overell (2007) highlights the efficacy of environmental audits in enhancing performance, while Yook (2016) explores the role of environmental management systems. Aluchna et al (2023) underscore the importance of research into "integrated reporting," seamlessly blending financial and environmental data, potentially enhancing informed decision-making and long-term value creation.…”

The Impact of Corporate Characteristics on Climate Governance Disclosure

“…Researchers insist that more research is required due to the increasing involvement of the private sector in climate governance [84,85]. In addition, the inconsistency of the findings provided by previous studies is also often noted as being problematic [86].…”