INFLUENCE OF BOARD CHARACTERISTIC ON ENVIRONMENTAL MANAGEMENT CONCERN IN CONSTRUCTION INDUSTRY

This study examines board characteristics (i.e., size and tenure) as factors that influence the Environmental Management Concerns (EMC) of construction companies in Malaysia. The study follows a content analysis approach using data from the annual reports of listed construction companies over the period of 2010-2012, which provides the data for the index developed. Overall, the mean score of EMC for construction companies ranges from 7.14% to 100%. The average mean score is 30.56%. The top five companies score higher than 96% regarding EMC disclosure. Using regression analysis, this study provides direct evidence that board characteristic influences EMC in environmentally sensitive sectors. Board tenure, however, does not influence EMC among construction firms. The findings have some significant implications for environmentally sensitive sectors where a larger number of board members will provide such firms with greater knowledge and expertise to access resources effectively. The results of the present study emphasize the continuing importance of the role played by board members in monitoring strategic decision-making processes; and providing counsel and advice to firms.