Redefining corporate accountability for sustainable development: the strategic nexus of innovation and governance mechanisms in building institutional resilience

Abednego Osei, Maxwell Kongkuah () and Michael Ayikwei Quarshie
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Abednego Osei: Jiangsu University
Maxwell Kongkuah: Canakkale Onsekiz Mart University
Michael Ayikwei Quarshie: Jiangsu University

SN Business & Economics, 2025, vol. 5, issue 12, 1-31

Abstract: Abstract In today’s dynamic business landscape, where sustainability has become a fundamental pillar of corporate responsibility and long-term success, the governance structures that drive sustainability practices warrant deeper scrutiny. This study explores the complex relationship between board dynamics and sustainability footprint disclosure among listed firms in the MENA region, with a particular focus on the moderating role of innovation capacity. Grounded in Agency Theory and Stakeholder Theory, the study analyzes data from 461 companies over the period 2010 to 2022, employing robust econometric techniques to ensure methodological rigor. The findings present compelling evidence that board interlock, gender diversity, board digital literacy, and board ownership positively influence sustainability footprint disclosure, while board independence and the presence of foreign nationals demonstrate negative associations. Notably, the study highlights that innovation capacity plays a critical role in enhancing the impact of board dynamics on sustainability reporting. A heterogeneous analysis further reveals significant variations across industries in the MENA region. Additionally, the sensitivity analysis confirmed the robustness of the results, further reinforcing the reliability of the findings. This study provides important practical and policy implications by emphasizing the need for robust board structures and innovation-driven strategies to enhance corporate sustainability performance. It calls for gender diversity quotas, sustainability training for independent directors, and innovation incentives to improve governance quality and transparency in sustainability reporting. Beyond its theoretical contributions, the research encourages corporations and policymakers to prioritize sustainability-focused reforms that promote long-term value creation, stakeholder trust, and alignment with global sustainability standards.

Keywords: Board dynamics; Sustainability reporting; Innovation capacity; Corporate accountability transformation; Sustainability footprint disclosure; MENA (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s43546-025-00970-0

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