Impact of Human and Social Board Capital on the Level of Sustainability Reporting: Evidence from Saudi Arabia

Awatif Hodaed Alsheikh ()
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Awatif Hodaed Alsheikh: Accounting Department, Faculty of Administration and Economics, Umm Al-Qura University, Makkah 24382, Saudi Arabia

Sustainability, 2023, vol. 16, issue 1, 1-13

Abstract: The Board of directors serves as the primary mechanism for corporate governance, prompting numerous researchers to investigate the influence of its characteristics on the extent of sustainability reporting across various regions worldwide. Hence, this study aimed to examine the impact of human and social board capital, namely, a board of directors’ multiple directorships and level of financial expertise, on the level of sustainability disclosure (SRL) reported by non-financial Saudi companies during the period from 2018 to 2022. To achieve these objectives, 654 firm-year observations belonging to 140 non-financial companies in Saudi Arabia were used. An SRL index was constructed using the following four aspects of sustainability: governance, economic, social, and environmental aspects. At the same time, the most common measurements for independent variables, as found in the literature, were utilized. An OLS regression analysis was performed as the main test of our two hypotheses, and the concluded results demonstrated that both the board of directors’ multiple directorships and its level of financial expertise have significant positive impacts on the SRL. These findings are the first of their kind in the context of Saudi Arabia and can help market regulators, policymakers, and decision-makers in their attempt to achieve the goals of the country’s sustainability initiatives and Vision 2030.

Keywords: sustainability reporting; multiple directorship; board expertise; Saudi Arabia; non-financial companies (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:16:y:2023:i:1:p:15-:d:1302877

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