The effect of corporate governance on sustainability disclosure (A Study based on bangladeshi companies)

The issue of corporate governance is one of the major challenges of today’s corporate world. Companies from different segments of the economy facing multiple challenges to ensure adequate and appropriate methods of governing their organizations. In this connection this article tried to analyze the effect of corporate governance on the sustainability disclosures of different companies in Bangladesh. The companies were selected from the four different segment of the industry namely banking, non-banking, servicing and manufacturing industries in Bangladesh. Total of 74 companies were analyzed regarding their effect of corporate governance on sustainability disclosures. For the study purpose data set were divided into two groups ’ independent variables and dependent variables. Independent variables includes types of organization, board size, numbers of independent directors, percentage of independent directors, numbers of women directors, percentage of women directors in the board, number of foreign directors, percentage of foreign directors in the board, independent committee for CSR, and dependent variable is effect on sustainability disclosures. The one way ANOVA for continuous variables, chi- square test for categorical variables, Bi-variate and multi variate linear regression model were performed to identify the effect of corporate governance on sustainability disclosures of the companies. The result of one way ANOVA and chi-square test shows that, Numbers of board of directors (P<.001), percentage of independent directors (P<.025), numbers of women directors (P<.002), presence of independent CSR committee (P<.003) are statistically significant, which means that these four factors of corporate governance have significant association to sustainability disclosures according to the types of organizations under study. The result of Bi-variate analysis shows that, Number of board of directors (P<. 006), Number of independent directors (P<. 025) in the board have a significant bearing on the sustainability disclosure of the firms. The multivariable regression model analysis concludes that, Number of women directors in the board (P<. 042), Number offoreign directors in the board (P<.039), Percentage of foreign directors in the board (P<.027) are significantly correlated to sustainability disclosures of the concerned companies under study.