An examination of Malaysian companies’ SDG reporting: does the corporate governance-level mechanisms matter?

Abstract

Purpose

Sustainable development goals (SDGs) have been attracting ever considerable attention from practice and academia, but the relationship between board characteristics and SDGs reporting remains unclear, especially in emerging countries. This paper empirically aims to the impact of board characteristics on SDGs reporting.

Design/methodology/approach

Based on stakeholder-agency theory, this study used data from 572 firm-year observations between 2017 and 2023 from top Malaysian-listed companies.

Findings

The result of feasible generalized least squares regression indicates that larger, more independent boards are associated with increased SDG disclosure. This suggests that well-structured boards can positively influence decision-making by reducing information asymmetries and agency conflicts. On the other hand, the results reveal that board activity insignificantly impacts the disclosure of SDGs. The findings are robust to robustness analyses and endogeneity checks.

Practical implications

This research offers significant implications for companies, practitioners and stakeholders, seeking to enhance their commitment to SDG implementation. In addition, the findings provide valuable insights for policymakers to encourage companies to diversify their composition boards and to promote strong, complementary governance mechanisms that align management behavior with sustainable business objectives.

Social implications

The findings can enhance SDG reporting quality by improving materiality assessment disclosures. This increased transparency and accountability will empower corporate stakeholders to better evaluate the reporting entity’s underlying processes. Enhanced corporate SDG reporting aligns with Malaysia’s commitment to implementing the UN SDGs and transitioning to a sustainable future.

Originality/value

The findings offer fresh insights into a previously unexplored topic and highlight the important role of the corporate board in addressing and improving the corporate SDGs reporting of listed firms in Malaysia.

Citation

Qaderi, S.A. (2025), "An examination of Malaysian companies’ SDG reporting: does the corporate governance-level mechanisms matter?", Measuring Business Excellence, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/MBE-08-2024-0129