Impact of Corporate Governance Attributes on Corporate Social Responsibility Disclosure: A Study of South Africa and Sri Lanka

Abstract

This study examines the impact of Corporate Governance (CG) on Corporate Social Responsibility Disclosure of listed bank and finance firms in South Africa and Sri Lanka over the period 2013-2017. A sample of 28 firms out of 43 and 45 out of 59 firms listed on Johannesburg and Colombo Stock Exchange respectively was studied. The study made use of secondary data generated from Annual Reports of the sampled firms. The data was analysed by means of descriptive statistics, correlation and regression analysis using Stata (version 12) package. The analysed CG attributes include Board size; Board independence; audit committee independence and CEO duality and control variables which are firm size and profitability (ROA). The important findings of this study is that smaller Boards of Sri Lankan firms have a significance strong influence on corporate social responsibility disclosure than the larger Boards of South Africa. While CEO duality shows a significant negative effect on corporate social responsibility disclosure. However, Audit committee independence indicates an insignificant association with corporate social responsibility disclosure. Based on the findings, the study recommends among others, that firms in the bank and finance sector should have a competent size of five to 13 of board members, so as to encourage corporate social responsibility disclosure