RT Article
T1 Corporate governance and supplemental environmental projects: a restorative justice approach
JF Journal of business ethics
VO 173
IS 2
SP 261
OP 280
A1 Nadeem, Muhammad
LA English
YR 2021
UL https://ixtheo.de/Record/1774590808
AB Firms have traditionally responded to environmental violations by increasing information disclosure and/or communication to manage stakeholder perceptions. As such, these approaches may be symbolic in nature, with no genuine intention to improve the environment. We draw from restorative justice grounded in stakeholder theory and explore a relatively new approach in the form of supplemental environmental projects (SEPs) aimed at restoring the environment, and empirically examine the role of corporate governance (board structure) in firms’ decisions to undertake reparative actions. Using environmental violations and SEPs data from the US Environmental Protection Agency between 2002 and 2015, we find that firms with smaller boards are more likely to undertake SEPs. We also find that firms with higher board independence and CEO duality undertake SEPs more frequently; however, board gender diversity and the existence of a sustainability committee appear to have no impacts. These results are robust to propensity score matching and an alternative data source. We extend the scope of stakeholder theory by emphasizing a new approach—restorative justice—by which corporations can repair damaged relationships and also improve the environment. We also contribute to corporate governance and environmentalism literature by identifying governance structures that promote environmental restorative justice. Thus, our study will inform different stakeholders, including regulators, shareholders, and boards of directors, and will open new avenues for business ethics scholarship.
K1 Corporate Governance
K1 Environmental violations
K1 Restorative Justice
K1 Stakeholder Theory
K1 Aufsatz in Zeitschrift
DO 10.1007/s10551-020-04561-x