The Impact of Corporate Governance Quality on Social Sustainability: Exploring the Moderating Effect of Profitability رسالة ماجستير

Abstract

Companies with deficient governance frequently experience poor financial performance, which decreases their interest in environmental sustainability activities and makes them less likely to participate in such initiatives. Information gathered from 2018–2022, all from publicly traded financial companies' annual reports. The relationship between corporate governance quality and social sustainability within firms listed on the Palestine Exchange is empirically examined in this study, which employs agency theory and resource dependency theory as theoretical frameworks. The research highlights the significant role of corporate governance in fostering social sustainability practices. Using panel data, the analysis tests hypotheses using the Ordinary Least Squares (OLS) regression model. This study lends credence to agency theory by showing that good corporate governance is associated with social sustainability. Companies with strong corporate governance seem to have a positive impact on a wider variety of stakeholders, including workers, communities, and the environment, as well as improved financial performance and social sustainability initiatives. Firms with robust governance systems and higher profitability are associated with more sustainable social practices, according to the study, which also highlights the moderating impact of profitability. The significance of efficient governance systems in advancing sustainable development objectives is highlighted by these results, which offer important insights for scholars, practitioners, and politicians focused on the correlation between corporate governance (CG) and sustainability. Businesses and organizational policymakers, It will instruct them on improving governance and increasing its contribution to social sustainability and in assisting decision-makers in developing V systems and incentives that promote and implement social sustainability practices within companies