Professional Competency and Board Diversity as Explanations for Differentiation in Corporate Governance Disclosure Levels

Claus Holm, Aarhus University
Finn Schøler, Aarhus University

Abstract: Corporate governance recommendations for supervisory boards tie strategic decisions to board member competencies. We apply logit regression models on financial and corporate governance data from 100 listed Danish companies. We find that the decision to have a high corporate governance disclosure level is related to international experience, certain types of professional background/ experience as well as gender diversity and general experience diversity. Our findings suggest that company leaders in Denmark have sought a competitive advantage through differentiation in the part of the value chain directed toward the capital market. This is consistent with the theoretical resource dependency perspective in relation to the ability and willingness to strengthen corporate governance reporting.