This paper aims to critically review the existing literature on the relationship between corporate governance, in particular board diversity, and both corporate social responsibility and corporate social responsibility reporting and to suggest some important avenues for future research in this field. Assuming that both CSR and CSRR are outcomes of boards’ decisions, this paper proposes that examining boards’ decision making processes with regard to CSR would provide more insight into the link between board diversity and CSR. Particularly, the paper stresses (...) the importance of studies linking gender diversity and CSR decision making processes, which is quite rare in the existing literature. It also highlights the importance of more qualitative methods and longitudinal studies for the development of understanding of the diversity–CSR relationship. (shrink)

This paper presents a literature review offering a thorough and critical systematization of articles investigating the influence of women directors on corporate social performance (CSP). We review the state-of-the-art literature in terms of its key assumptions, theories, and conceptualization of CSP. Our analysis shows a misfit between the theorization and operationalization of gender diversity, especially in quantitative empirical studies, which represent the majority of articles. In our overview of both conceptual and empirical studies, we identified three main theoretical dimensions, which (...) are contingent upon board-level and institution-level dimensions. Based on our proposed framework, we call for future researchers to focus on novel research questions and innovative research designs to investigate women’s contributions to CSP and challenge the theoretical assumptions about the role of women on boards. (shrink)

This paper explores an increasingly prevalent element of board-level commitment to sustainability. We propose a theoretical framework under which the existence and associated actions of board-level sustainability committees are motivated by shared value creation, where the interests of a diverse group of stakeholders are satisfied and sufficient profit is achieved. Using hand-collected data, we find that sustainability committees are heterogeneous in focus and vary in their effectiveness. Specifically, we disaggregate the sustainability committee construct based on stakeholder group focus and find (...) that associations between sustainability committees and performance outcomes are stronger when committees focused on a specific stakeholder group are paired with relevant performance outcomes. We generally find that sustainability committees are effective at impacting relevant strengths, but do not mitigate relevant concerns. These results are consistent with the shared value framework, where committees both generate value by pursuing sustainability-related opportunities and protect value by monitoring, but not necessarily mitigating sustainability-related risks. Univariate tests suggest that effective committees are also larger, more independent, and meet more frequently. Finally, we propose a new method to classify industries based on their sensitivity to certain stakeholder groups and find that the effectiveness of committees focused on specific stakeholders is more pronounced in industries that are sensitive to these stakeholders. (shrink)

Previous studies in Western contexts have examined the relationships between various board characteristics and CSR, yet the relationships need to be re-examined in non-Western contexts given differential theoretical premises across contexts. We specifically propose that the effects of board characteristics on CSR in Korea should be patterned distinctively from Western-based existing literature, focusing on three important board characteristics, such as a board’s independence, social ties, and diversity. Using a panel dataset from large Korean firms, we found that various relationships between (...) board characteristics and CSR were non-linear, whereas most of the previous research on Western contexts found that the same relationships were linear. Specifically, curvilinear relationships were found between CSR and board independence, CEO-outside director social ties, and educational diversity. Our findings suggest that there is no universal feature of CSR-supportive board characteristics due to the unique characteristics of various institutional contexts. (shrink)

This study empirically examines the relationship between wide-ranging board diversity and the quality of corporate social responsibility disclosure variables in Malaysia. We extend prior literature covering broader dimensions of board diversity and their impact on CSR after controlling for board and audit committee characteristics. Using 200 listed firms in Bursa Malaysia during 2009–2013 and applying both OLS and 2SLS instrumental variables approaches, we document significant positive effect of board education level and board tenure diversity on the quality of CSR disclosure. (...) Further analysis using robust regression also shows positive association between gender diversity and CSR disclosure. Our findings also demonstrate that the quality of CSR disclosure is significantly negatively associated with board age and nationality diversity. These results remain consistent with using alternative measures for board diversity, and characteristics for board of director and audit committees as well as split samples between large and small firms. Additional tests exhibit complementary relationship of education level and nationality with gender, while substitutive relationship of age and tenure with gender in influencing CSR. These findings provide useful insights into the policy makers in setting regulations in respect of board diversity in Malaysia and other emerging economies in the Asian region. Our evidence is also useful for listed companies in setting the criteria to identify directors who can support their strategic decisions. (shrink)

We aggregate different dimensions of corporate social responsibility (CSR) activities following the stakeholder framework proposed in Clarkson (Acad Manag Rev 20(1), 92–117, 1995) and present consistent evidence that CSR strengths targeting different stakeholders have their unique impact on firm risk and financial performance. Institutional CSR activities that target secondary stakeholders are negatively associated with firm risk, measured by total risk and systematic risk. Technical CSR that target primary stakeholders are positively associated with firm financial performance, measured by Tobin’s Q, ROA, (...) and cash flow returns. Our results, based on a sample of S&P 500 component firms over the period of 1995–2009, are consistent with the risk management view of “altruistic” CSR activities and with the stakeholder salience theory. We also show that the impact of CSR activities on risk varies with the ethical climate, as proved in our subsample analyses on pre- and post-Sarbanes–Oxley periods. Our empirical analyses mitigate possible omitted variables and endogeneity concerns that are often overlooked in previous research. Our findings are robust to alternative CSR measures, to alternative risk and performance measures, and to alternative estimation methods. (shrink)

When companies engage in corporate philanthropy, they can donate to a number of causes supporting a variety of issues, thus establishing cause portfolios. This research examines how the focus of a cause portfolio affects company evaluations. Results from an experiment show that when a company donates a small amount of money, consumers have lower evaluations of a company when the cause portfolio is focused (i.e., supports one issue) versus diverse (i.e., supports many issues). This is because the focused (vs. diverse) (...) portfolio is perceived to have a weaker impact to society. We provide additional evidence of this effect using a data set of Fortune 500 companies’ foundations, showing that cause portfolios are more likely to result in lower stakeholder evaluations when focused (vs. diverse). Again, we find that donation amount alleviates the difference between focused and diverse portfolios. The findings hold important implications for the company’s management of cause portfolios. (shrink)

Business and Society Review, Volume 126, Issue 4, Page 407-431, Winter 2021.

There is increasing interest in determining what impact having women in management positions may have on corporate social responsibility initiatives. Various authors suggest that gender equality practices should be factored into the broader framework of CSR. This paper examines how the presence of women on corporate boards, in top and middle management and as heads of CSR departments, influences gender equality practices in the field of CSR. Using information collected from companies that have signed up to Women's Empowerment Principles in (...) Spain, we show that the presence of women in the aforesaid posts has a positive impact on CSR activities with gender equality objectives. We thus supplement the justice, business and moral arguments with further arguments in support of the incorporation of women into not only corporate boards but all management positions. Finally, we provide a view of how gender equality can be included in the broader framework of CSR. (shrink)