The Effect of Board Independence on the Sustainability Reporting Practices of Large U.S. Firms

Abstract

As sustainability reporting becomes more commonplace, it is important to understand the 
factors that influence firms’ voluntary reporting decisions. This exploratory study examines 
whether board independence affects the sustainability reporting decisions of the 500 largest 
firms in the United States. We also investigate other factors that may be associated with 
sustainability reporting, including environmental performance and reputation. We find that 
firms with a greater proportion of independent board members are: 1) more likely to publish 
standalone sustainability reports, and 2) more likely to publish higher quality sustainability 
reports. This paper contributes to prior literature that reports somewhat mixed results on the 
effect of board independence on voluntary disclosure.