The mediating role of shareholders score in fostering environmental innovation through integrated reporting: insight from Japan
Abstract
Purpose
This study aims to investigate the relationship between integrated reporting, environmental innovation and the mediating effect of shareholder scores within the context of Japan.
Design/methodology/approach
SEM on panel data are used to study the impact of the role of shareholder scores in mediating the effect of integrated reporting on environmental innovation. This empirical study was based on a sample of 420 companies operating in Japan for the period spanning 2010 and 2022.
Findings
Drawing upon empirical results, this research uncovers the pivotal role of the shareholder's score as a mediating factor in this relationship. A higher shareholder score signifies a governance structure that values shareholder input and fairness in treatment. Empowered shareholders leverage their influence to advocate for transparent reporting practices that encompass environmental considerations. Consequently, firms with elevated shareholder scores are more inclined toward environmental innovation, aligning their strategies with sustainability imperatives.
Originality/value
The findings contribute to understanding of how corporate governance mechanisms, particularly shareholder empowerment, interact with reporting practices to drive environmental initiatives, providing valuable implications for sustainable business practices globally.
Keywords
Acknowledgements
Availability of data and materials: All data generated or analyzed during this study are included in this published article (and its supplementary information files).
Competing interests: On behalf of all authors, the corresponding author states that there is no conflict of interest.
Funding: None declared under financial, general, and institutional competing interests.
Acknowledgements: No acknowledgements.
Authors' contributions: Kawther Dhifi and Karima Lajnef analyzed and interpreted the relationship between IR, environmental innovation, and the mediating effect of shareholder scores within the context of Japan. Using the quantitative research methodology outlined by Preacher and Hayes (2008), this study conducts an analysis of data obtained from 420 companies operating in Japan between 2010 and 2022. Drawing upon empirical results, this study reveals a positive relationship between IR and environmental innovation. Japanese firms adopting IR practices tend to emphasize comprehensive reporting, including environmental assessments, moving beyond traditional financial disclosures. Furthermore, this research uncovers the pivotal role of the Shareholder's Score as a mediating factor in this relationship. A higher shareholder score signifies a governance structure that values shareholder input and fairness in treatment. Empowered shareholders leverage their influence to advocate for transparent reporting practices that encompass environmental considerations. Consequently, firms with elevated shareholder scores are more inclined toward environmental innovation, aligning their strategies with sustainability imperatives. The authors read and approved the final manuscript.
Citation
Dhifi, K. and Lajnef, K. (2024), "The mediating role of shareholders score in fostering environmental innovation through integrated reporting: insight from Japan", Global Knowledge, Memory and Communication, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/GKMC-11-2023-0467
Publisher
:Emerald Publishing Limited
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