This paper investigates the effect of female representation on the board of directors on corporate response to stakeholders’ demands for increased public reporting about climate change-related risks. We rely on the Carbon Disclosure Project as a sustainability initiative supported by institutional investors. Greenhouse gas emissions measurement and its disclosure to investors can be thought of as a first step toward addressing climate change issues and reducing the firm’s carbon footprint. Based on a sample of publicly listed Canadian firms over the (...) period 2008–2014, we find that the likelihood of voluntary climate change disclosure increases with women percentage on boards. We also find evidence that supports critical mass theory with regard to board gender diversity. These findings reinforce initiatives being undertaken around the world to promote gender diversity in corporate governance while demonstrating board effectiveness in stakeholder management. (shrink)

We investigate the effectiveness of corporate social responsibility disclosure in protecting corporate reputation following financial restatements. As expected under legitimacy theory, firms can signal their legitimacy via nonfinancial disclosure after the negative effects of financial restatements. Our results show that restating firms make substantial improvements to overall CSR disclosure quality by changing their standalone reports to a more conservative tone, increasing readability and report length, even though they strategically disclose less forward-looking and sustainability-related content. Such improvements are more pronounced in (...) restating firms with prior low-quality CSR disclosure. Moreover, restating firms with CSR disclosure have smaller forecast errors than non-CSR disclosers, yet the change in CSR disclosure after restatements does not further improve analyst forecast accuracy. Finally, we find that compared with nondisclosers, restating firms with CSR disclosure suffer smaller firm value losses. Overall, the evidence supports the view that consistent CSR reporting alleviates reputational damage and plays an insurance-like or value protection role during crisis periods. (shrink)

We explore corporate environmental accountability by examining how carbon emissions affect voluntary climate-related information disclosure based on TCFD principles. Using computerized textual analysis to measure such climate-related disclosure, our results show that firms with higher levels of carbon emissions disclose more climate-related information. This relation is stronger in firms belonging to carbon-intensive industries, such as energy, materials, and utilities. We also examine this relationship at the category level for Governance, Strategy, Risk Management, and Metrics and Targets, finding that carbon emissions (...) drive disclosure in all categories except in Governance. Overall, our findings indicate that high carbon emitting firms appear to discharge their corporate accountability by increasing climate-related disclosure, consistent with legitimizing their potentially unethical actions and submitting to stakeholder and societal pressure. (shrink)

We attempt to understand the personal incentives that motivate corporate insiders to engage in unethical behavior such as delayed trade disclosure. Delayed disclosure affects corporate transparency and other shareholders in the firm potentially suffer investment losses because they are unaware of insiders’ activities. Using archival data from the 300 largest Australian firms between 2007 and 2011, the results show that risk factors such as insider age and tenure and wealth effects in the form of insider shareholdings affect the likelihood of (...) delayed reporting. Governance positions such as committee membership mitigate this behavior. Our study highlights the importance of considering individual insider’s wealth and risk factors. The self-monitoring role of governance positions is also indicative of the effectiveness of internal corporate governance in the prevention of illegal insider behavior. (shrink)