This paper analyzes whether effective boards of directors in addressing shareholder
interests also prove to be effective in guaranteeing the interests of the rest of the firm’s
stakeholders. We measure board effectiveness based on the shareholder perspective, and test
whether it is valid for the stakeholder perspective. The novelty of this paper precisely lies in its
approach, given that it considers both perspectives of corporate governance at a time. Using
the transparency of sustainability reports as a proxy for the stakeholder perspective in an international sample of 2366 companies, the paper shows that effective boards are more likely to
address the interests of both the shareholders and the rest of the firm’s stakeholders. Furthermore, we propose a measure of board effectiveness by gathering several board characteristics.
Our results contribute to research on corporate governance and corporate social responsibility
reporting, and it has implications for policy makers.
