What makes organizations so similar? We contend that the engine of rationalization and bureaucratization has moved from the competitive marketplace to the state and the professions. Once a set of organizations emerges as a field, a paradox arises: rational actors make their organizations increasingly similar as they try to change them. We describe three isomorphic processes-coercive, mimetic, and normative—leading to this outcome. We then specify hypotheses about the impact of resource centralization and dependency, goal ambiguity and technical uncertainty, and professionalization and structuration on isomorphic change. Finally, we suggest implications for theories of organizations and social change.

The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields (Chinese Translation)

Historically, management theory has ignored the constraints imposed by the biophysical (natural) environment. Building upon resource-based theory, this article attempts to fill this void by proposing a natural-resource-based view of the firm—a theory of competitive advantage based upon the firm's relationship to the natural environment. It is composed of three interconnected strategies: pollution prevention, product stewardship, and sustainable development. Propositions are advanced for each of these strategies regarding key resource requirements and their contributions to sustained competitive advantage.

A natural resource-based view of the firm

This study investigates the association between environmental, social, and governance (ESG) disclosure and diversity of the board of directors (BoD) in Italian listed companies. Diversity of BoD in terms of gender diversity, CSR committees, board average, and independent directors are examined as to their influence on voluntary ESG disclosure. This rating is highly relevant to managers and investors considering ESG issues in their decision-making process. The factors that drive or hinder ESG disclosure are gaining importance. Despite the relevance of the topic, in Italy there is a scarce amount of literature regarding diversity in the BoD. The data set includes ESG data for more than 54 Italian companies for the period 2011–2014. The results indicate that firm's CSR disclosure is associated with independent director and committee CSR. In addition, women on BoDs is negatively correlated while the age of the board is not significant. Based on this study, shareholders and policymakers will have a deeper knowledge on the significant roles that board diversity is playing as a determinant of ESG disclosure. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment

Diversity of Board of Directors and Environmental Social Governance: Evidence from Italian Listed Companies

In this study, we examine three potential explanations for the corporate choice to disclose environmental capital spending amounts. We investigate, first, whether the disclosure appears to be a function of the materiality of the spending and we find that, for the overwhelming majority of observations, the disclosed amounts are not quantitatively material. This suggests that non-disclosure is likely due to immateriality. We next attempt to differentiate the choice to disclose across voluntary disclosure theory and legitimacy theory arguments. Our findings show that disclosing firms do not exhibit improved subsequent environmental performance relative to non-disclosing companies. Further, controlling for firm size and industry class, we find the choice to disclose is associated with worse environmental performance. Overall, our results suggest that companies use the disclosure of environmental capital spending as a strategic tool to address their exposures to political and regulatory concerns.

https://halshs.archives-ouvertes.fr/halshs-00459410/document

Corporate disclosure of environmental capital expenditures: a test of alternative theories

The impact of board and audit committee characteristics on voluntary disclosure: a meta-analysis

This paper investigates the effect of corporate governance practices on the extent of voluntary disclosure in France. Using a panel of 206 non-financial French listed firms during the period 2006–2009, we find evidence that voluntary disclosure in annual reports increases with managerial ownership, board and audit committee independence, board meeting frequency, and external audit quality. We also find that frequency of audit committee meetings and diligence of board and auditing are associated with decreased disclosure. Additional findings show that larger, more profitable, and less indebted firms have greater voluntary disclosure.

Corporate Governance And Voluntary Disclosure In France

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This paper aims to investigate the joint effect of board independence and gender diversity on the effectiveness of boards in monitoring CEO compensation in a continental European context, i.e. France.,Fixed-effect regressions are used to study the impact of board independence, gender diversity and their interaction, i.e. the proportion of female independent directors on the different components of CEO compensation (total, fixed and variable).,The authors observe that both the proportions of independent directors and women sitting on the boards positively influence the various components of CEO compensation. However, the interaction of these factors, i.e. the proportion of female independent directors, is negatively associated with CEO compensation. These results suggest that independent women directors improve board effectiveness in monitoring CEO compensation, especially its fixed component.,The results of this research help to elucidate the importance of women being appointed to boards as independent directors to properly monitor managerial pay. These results provide support to the approach of the French Cope-Zimmerman law of January 2011, which promotes female representation on boards as independent directors to enhance board decision-making. Thus, evidence presented and discussed in this paper should provide useful insights for academics, corporate managers and regulators.

Board independence, gender diversity and CEO compensation

The purpose of this paper is to examine how corporate social responsibility (CSR) reporting influences leverage ratios. In particular, this paper aims to determine whether firms with higher CSR disclosure scores have better access to debt financing.,This paper uses a panel data analysis of non-financial French firms listed on the Euronext Paris Stock Exchange and members of the SBF 120 index from 2010 to 2015. The environmental, social and governance (ESG) disclosure scores that are collected from the Bloomberg database are used as a proxy for the extent of ESG information disclosures by French companies.,The empirical results demonstrate that leverage ratios are positively related to CSR disclosure scores. In addition, the results show that the levels of long-term and short-term debt increase with the disclosure of ESG information, thus suggesting that CSR disclosures play a significant role in reducing information asymmetry and improving transparency around companies’ ESG activities. This finding meets the lenders’ expectations in terms of extrafinancial information and attracts debt financing sources.,The research is based only on the quantity of the ESG information disclosed by French companies and does not account for the quality of the CSR disclosures. The empirical model omits some control variables (e.g. the nature of the industry, the external business conditions and the age of the firm). The results should not be generalized, since the sample was based on large French companies for 2010–2015.,France is a highly regulated context that places considerable pressure on French firms in terms of CSR policies. The French Parliament has adopted several laws requiring transparency in the environmental, social, and corporate governance policies of French firms. In this context, firms often regard CSR policies as constraints rather than opportunities. This study highlights the benefits that result from transparent CSR practices. More precisely, it provides evidence that the high disclosure of ESG information is a pull factor for credit providers.,This study extends the scope of previous studies by examining the value and relevance of CSR disclosures in financing decisions. More precisely, it focuses on the relatively little explored relationship between the extent of CSR disclosures and access to debt financing. This paper demonstrates how each category of CSR disclosure information (e.g. social, environmental and governance) affects access to debt financing. Moreover, this study focuses on the rather interesting empirical setting of France, which is characterized by its highly developed legal reforms in terms of CSR. Achieving a better understanding of the effects of ESG information is useful for corporate managers desiring to meet lenders’ expectations and attract debt financing sources.

Corporate social responsibility disclosure and debt financing

The purpose of this paper is to test whether or not CSR disclosure (i.e. aggregate as well as its three sub-indicators) reduces the cost of debt for French corporations listed in the SBF 120 index between 2010 and 2015.,CSR disclosure ratings of firms were collected from the Bloomberg database under three dimensions such as environmental, social and governance (ESG). Then, a pooled regression analysis was run.,The results indicate that overall CSR disclosure score as a combination of ESG disclosure scores has a negative effect on the cost of debt (i.e. lowers the cost of debt). While environmental disclosure is negatively associated with the cost of debt, social disclosure is unexpectedly positively associated, and governance disclosure has an insignificant association with the cost of debt.,The study has two main limitations. First, the analysis does not consider contractual constraints and obligations that might exist in debt contracts (Jung et al., 2018). Second, the analyses cover a specific time period (i.e. between 2010 and 2015) for a specific country (i.e. France) excluding utilities and the financial sector.,Overall, it is inferred from the results that financial markets for lenders take into account CSR disclosure when assessing the creditworthiness of borrowers. Specifically, environmental disclosure is the only subdimension of CSR that is influential on creditors’ decisions to offer favorable interest rates. In line with this outcome, companies can assess their processes and be more aligned with eco-friendly practices, and investors are particularly advised to invest in those types of firms.,This study extends scant literature on the association between CSR and the cost of debt by exploring how creditors treat CSR dimensions dissimilarly in granting loans to firms. The findings of this study have particular importance as financial debt is one of the most predominant forms of external financing.

Amal Hamrouni

Papers

Corporate Governance And Voluntary Disclosure In France

Corporate Governance And Voluntary Disclosure In France

Board independence, gender diversity and CEO compensation

Corporate social responsibility disclosure and debt financing

Are corporate social responsibility disclosures relevant for lenders? Empirical evidence from France