Corporate Governance and Corporate Social Responsibility Disclosure

Abstract

Developed countries are increasingly concerned about the relationship between corporate governance and corporate social responsibility disclosure while developing countries recently started to take care of this issue. Therefore, the main objective of the study is to examine the effect of the board mechanisms of corporate governance on the extent of social responsibility disclosure of Jordanian public industrial companies during the period (2010 to 2014). In this research, descriptive statistics are used to study variables, both correlation matrix and collinearity diagnostic are used to test whether multicollinearity problem exists. Finally, OLS regression analysis is used to test the hypotheses of the study. The results show that the extent of social responsibility disclosure is positively affected by board size and percentage of women on board, negatively affected by duality and board average age. Board meetings and board composition are insignificant to social responsibility disclosure. The study faces several limitations where the measurement of corporate social responsibility requires human judgment, which is subjective and ambiguous. Furthermore, the study sample was limited to industrial companies. Understanding the relationship between CG and CSR is very important because the CG mechanism is an obligation to protect and improve social, economic, and environment, as well as the welfare of society. CSR elements should be included within the companies' vision, mission, strategies and daily practices to maximize the shareholder value.