Social Performance Disclosed by European Companies: The Role of the Board Attributes and the Country’s Legal System

Abstract

This paper aims to analyze factors that influence social performance-related information disclosure in European countries. Specifically, the objective is to investigate the Board’s attributes (Diversity, Inclusion, People Development and Controversies). To achieve the goal, an empirical analysis was conducted with 2494 listed companies in Europe as support for the economic year 2021. To measure a possible link between the variables under study, a regression analysis was performed. Our results show that Board Diversity, Inclusion and People Development contribute positively to social performance disclosure, whereas Board Controversies negatively affect the dependent variable. Furthermore, the study results reveal that the country’s legal system is relevant to the company’s transparency. The model variables determine 62% of the social performance reporting variance. Our Results are useful for all non-financial information users, governments and organizations in developing sustainability reporting standards.