The moderating role of information technology governance in the relationship between board characteristics and continuity management during the Covid-19 pandemic in an emerging economy

The Covid-19 pandemic caused severe business disruptions across sectors, increasing risks to business continuity. Business continuity management aims to identify, plan for, and mitigate risks to sustain operations, with information technology playing a crucial role. Motivated by widespread operational interruptions and the increased reliance on digital technologies, this study posits that corporate governance characteristics alone may be insufficient during crises; effective IT governance is needed to maintain continuity. The study focuses on Jordan and addresses two main questions: (1) To what extent did corporate governance characteristics (board size, independence, diligence, audit committee features, board committees, external audit) influence business continuity during Covid-19? (2) Did IT governance moderate the effect of corporate governance characteristics on business continuity? The study contributes by providing empirical evidence from an emerging economy during Covid-19, examining IT governance alongside corporate governance in the context of business continuity, and employing structural equation modelling on perceptions of directors, executives, auditors, and IT specialists.

The background highlights Covid-19’s global disruptions and the heightened importance of digital technologies for maintaining operations, education, and social connection. Prior literature addresses business continuity planning (BCP) and crisis management but rarely links corporate governance characteristics (CGC), IT governance (ITG), and business continuity (BC), especially during Covid-19. Studies suggest BCM integrates business and technological components; IT readiness and governance structures (e.g., COBIT) are vital for continuity. Board involvement, independence, and IT expertise can shape ITG, yet many boards lack IT governance expertise. The study develops three hypotheses: H01: No significant impact of CGC on BCM during Covid-19. H02: No significant impact of CGC on ITG during Covid-19. H03: No significant moderating effect of ITG on the relationship between CGC and BCM during Covid-19. The literature underscores that ITG exists at strategic, management, and operational levels and that board and audit committee roles are central to IT strategy, risk, and information security oversight. Frameworks like COBIT emphasize board and executive responsibility in ITG and its alignment with corporate governance to enhance value and manage risk. The gap identified is the lack of empirical evidence on how CGC and ITG jointly affect BCM during Covid-19 in emerging economies.

Design: Quantitative cross-sectional survey. Population and sampling: Jordanian businesses across sectors; respondents included board members, senior executives, auditors, and IT assistants/experts. Sampling used snowball and convenience methods via online platforms (Facebook, WhatsApp, email). Sample size determination used PLS path modelling rules-of-thumb and G*Power; minimums ranged from 160 to 184. Collected 232 complete responses (no missing data). Sample adequacy: KMO = 0.963; Bartlett’s Test of Sphericity χ2 = 7956.149, df = 741, p < 0.001, indicating suitability for factor analysis. Instrument: 39 closed-ended items on a 5-point Likert scale (1=strongly disagree to 5=strongly agree) across nine constructs: corporate governance characteristics (board size, board independence, board diligence/meetings, audit committee independence, audit committee diligence/meetings, board committees, external audit), IT governance (moderator), and business continuity (dependent). Measurement sources were adapted from prior studies; each construct had 3–5 indicators. Data analysis: SPSS 23 for data screening, exploratory factor analysis (EFA), reliability (Cronbach’s alpha), and assumption checks (residuals, outliers, normality, multicollinearity). SmartPLS 3 for confirmatory factor analysis (CFA), reliability/validity (loadings, Cronbach’s alpha, CR, AVE), discriminant validity (Fornell-Larcker), and structural equation modelling (PLS-SEM) including moderation using a two-stage approach. Measurement model: EFA retained items with loadings >0.40; some items were dropped for low or cross-loadings. CFA showed factor loadings ~0.55–0.88, CR ~0.82–0.92, AVE generally >0.50, and adequate Cronbach’s alpha for all constructs. Discriminant validity was established. Structural models estimated direct effects (CGC and ITG on BC; CGC on ITG) and interaction terms for moderation (CGC × ITG → BC).

- Sample: 232 respondents; KMO 0.963; Bartlett’s χ2 = 7956.149, df = 741, p < 0.001. Measurement reliability and validity met thresholds (CR ~0.82–0.92; AVE >0.50). - Direct effects on business continuity (BC): Corporate governance characteristics mostly had insignificant direct effects on BC during Covid-19, except audit committee independence (ACIND), which had a statistically significant positive effect. Information technology governance (ITG) had a statistically significant positive effect on BC. The adjusted R2 for the BC model was approximately 0.68, indicating that CGC and ITG explain about 68% of the variance in BC. - Effects on IT governance: Board size, board independence, audit committee independence, audit committee diligence, and external audit had statistically significant positive effects on IT governance. Board diligence and board committees showed insignificant effects on IT governance. The adjusted R2 for the ITG model was approximately 0.88, indicating CGC explained about 88% of the variability in ITG. - Moderation by IT governance: ITG significantly moderated several CGC–BC relationships. Specifically, the moderation was significant for board size (negative moderation), board independence (positive), board diligence/meetings (positive but weak), audit committee independence (positive), audit committee diligence/meetings (positive), and external audit (positive). ITG did not significantly moderate the relationship between board committees and BC. - Overall hypothesis outcomes: H01 was largely supported except for ACIND (which significantly affected BC). H02 was rejected in part as multiple CGCs significantly affected ITG (board size, independence, AC independence and diligence, external audit). H03 was partially rejected: ITG significantly moderated most CGC–BC links except for board committees.

The findings address the research questions by showing that, during Covid-19, traditional corporate governance characteristics alone were generally insufficient to ensure business continuity; only audit committee independence directly enhanced BC. However, CGC significantly shaped IT governance, which in turn had a positive effect on BC, underscoring the central role of ITG in crisis continuity. The strong relationships from board size, independence, audit committee characteristics, and external audit to ITG suggest that governance structures can build ITG capacity, which becomes pivotal for sustaining operations under disruption. The moderation results demonstrate that ITG changes how governance mechanisms translate into continuity outcomes: independent boards and effective audit committees strengthen the positive impact of ITG on BC, while larger boards may dampen it, possibly due to coordination challenges in crisis settings. These results align with literature that positions IT as a key driver of BCM and supports frameworks (e.g., COBIT) advocating board-level IT oversight. The study highlights the practical need for boards and audit committees to integrate IT governance into their agendas to enhance resilience and operational continuity during crises.

This study contributes empirical evidence from an emerging economy on how corporate governance characteristics and IT governance jointly shape business continuity during the Covid-19 crisis. It shows that while most CGCs do not directly improve BC, they significantly influence IT governance, and IT governance both directly enhances BC and moderates the effects of governance mechanisms on continuity. The study advances understanding by integrating CGC, ITG, and BCM, and by demonstrating the moderating role of ITG across several governance dimensions. Practical recommendations include elevating IT governance to the board and audit committee agenda, strengthening independent oversight and IT expertise, and embedding IT-driven strategies into BCM processes to prepare for and mitigate disruptions. Future research should extend the model to additional governance facets, conduct cross-country and sector-specific comparisons, and assess post-Covid periods to evaluate the persistence and generalizability of these relationships.

- Scope of governance variables was limited due to questionnaire length; additional CGCs were not examined. - Data collection faced Covid-19 restrictions and relied on non-probability online sampling, limiting representativeness. - Single-country context (Jordan) may constrain generalizability; cross-country comparisons are needed. - Timing during Covid-19 limits inference to crisis conditions; post-Covid comparisons are suggested. - General sample across sectors; future studies could perform sector-specific analyses or multi-sector comparisons.