Exploring the relationship between board characteristics and voluntary disclosure: evidence from France

Since recent years, social, environmental, and ethical concerns have grown within society all around the world. Climate change, decrease of biodiversity, the depletion of natural resources, inequalities… have become major subjects and society expectations are strong on these issues. A study conducted by the Materiality Observatory shows that environment is in the top three priorities issues in France, Germany and Poland and that social issues (employment, unemployment, human rights, and inequalities) follow very closely. This study also shows that 95% of French people, 89% of Germans and 77% of Poles expect companies to commit themselves to these issues. Firms are asked to have a responsible behaviour and to reduce their negative impact on society and the environment. They must communicate not only with their shareholders, but with all their stakeholders. People want to understand how firms are going to reduce their negative impact on society and the environment and ask for more transparency. Still the study cited above, the information provided by companies is important, to the extent that individuals evaluate the actions of companies based on concrete and verifiable results. Only a third of French people, 42% of Germans and only 57% of Poles believe that this information is sincere, complete, and clear. So, the aim of our study is to investigate how CSR disclosure could be improved. We choose to study the board of directors (BoD) because it is an important player in corporate governance. Its role in decision-making and defining corporate strategy is emphasized in the literature. It is also recognized for its essential role in defining a CSR policy (Kassinis and Vafeas, 2002; Maon & al., 2009), in monitoring its implementation (Hill and Jones, 1992) and in the quality of disclosure of extra-financial information to stakeholders (Michelon and Parbonetti, 2012). The aim of our study is therefore to investigate the role of the board of directors in the quality of extra-financial information disclosure and to identify the characteristics that contribute most to it. Knowledge of the determinants of good ESG information quality could enable the appointments committee or the BoD to seek out profiles or favour operating modes conducive to greater transparency toward stakeholders. At the academic level, Jizi (2017) indicates that studies addressing the link between board characteristics and CSR disclosure quality are scarce and lead to contrasted results. Whether in terms of board size, combining the functions of CEO and chairperson of the board, or board independence, the results of the various studies do not converge. Moreover, few of them concern France. Jain and Jamali (2016) call for further studies. Our work will therefore contribute to enriching the literature on the link between board composition and functioning and the quality of non-financial disclosure. Our article is structured as follows: Part 1 present the literature review and the hypotheses. Part 2 outlines the empirical study with the model, the variables, the sample, and the descriptive statistics. Then Part 3 presents the results and the discussion.