BOD Characteristics and Sustainability Reporting in Zimbabwe, 2018

Abstract

This study examined how various board of directors (BOD) characteristics, including gender diversity, BOD ethnicity, BOD independence, and BOD size, influence sustainability reporting among organisations listed on the Zimbabwe Stock Exchange (ZSE). This study employed a positivist philosophical approach and an explanatory research design. The study population consisted of 64 organisations listed on the ZSE. Out of the 52 annual reports that were screened, 30 companies that reported on economic, social, environmental and governance issues were identified and used as a sample for the study. The researcher collected data from 40 top executives and 41 BOD members through a questionnaire and analysed it using regression to determine the relationship between selected BOD characteristics and sustainability reporting. The results show that only BOD ethnicity is statistically significantly and positively associated with sustainability reporting (β = .494, p < .05). In contrast, BOD size, BOD independence, and gender diversity show no statistically significant relationship. The research shows that board heterogeneity, especially BOD ethnicity, may enhance board effectiveness and encourage sustainability reporting by bringing diverse experience, perspectives, and relationships to board discussions. The study recommends that shareholders and corporate governance practitioners consider board diversity when appointing directors. Companies, meanwhile, should strengthen governance processes to enable diverse board members to contribute to sustainability reporting.