BOARD CHARACTERISTICS AND ESG DISCLOSURE: EVIDENCE FROM THE BANKING INDUSTRY IN THE ASEAN REGION
Nurdin (a*)- Bambang Tjahjadi (b)

a), b) Fakultas Ekonomi dan Bisnis, Universitas Airlangga, Surabaya

Abstract

In recent years, the focus on environmental, social, and governance (ESG) practices has grown significantly, especially within the corporate governance framework. This research analyzes the relationship between board structure and ESG disclosure in the banking industry in ASEAN countries. Using a sample of 49 banks listed on stock exchanges in six ASEAN countries (Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam) from 2017-2023, the study employs ordinary least squares (OLS) regression for hypothesis testing, with additional tests and robustness and endogeneity checks to strengthen the findings. The results show that board size, the presence of women, and independent directors impact ESG disclosure in ASEAN banking companies, specifically influencing the environmental, social, and governance aspects of their reporting. Additional analysis reveals that these board characteristics can enhance the ESG pillars of banks in the region. As a practical implication, the findings suggest that banking companies can improve corporate governance quality by increasing gender diversity on the board and strengthening the proportion of independent directors, promoting transparency, accountability, and balanced decision-making. This research makes a unique contribution by focusing on the banking industry in ASEAN, a region that may be underrepresented in global literature on the relationship between board structure and ESG disclosure, considering the differences in regulatory frameworks, culture, and corporate practices compared to other regions

Keywords: Board structure, ESG disclosure, Banking industry, ASEAN countries

Topic: Corporate governance