Management Accounting Section Midyear Meeting

Board Risk Oversight and Environmental and Social Responsibility

• In Event: Corporate Boardrooms (Archival)

Abstract

Risk oversight has emerged as an important responsibility of corporate boards. At the same time, firms are increasingly recognizing the risks that social and environmental issues pose to investors and stakeholders. In this study, we examine the relation between board risk oversight and firms’ environmental and social (E&S) ratings. Using proprietary survey data on the board risk oversight practices of firms from 29 countries, we show that firms with more robust risk oversight have higher E&S ratings, are more likely to integrate E&S issues into their strategies and executive compensation contracts, and ultimately experience better E&S outcomes.

Authors

• Carolyn Victoria Deller, The Wharton School, University of Pennsylvania

• Christopher Ittner, University of Pennsylvania

• Hami Amiraslani, INSEAD

• Thomas Keusch, INSEAD