The board of directors and top management as determinants of corporate social performance
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2024-07-16
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en
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Corporate social performance (CSP) is increasingly relevant for companies. The members of the top management team and board of directors are important individuals that may affect the CSP of firms. Therefore, their characteristics may act as determinants of CSP. Thus, the following research question is addressed: “To what extent are the characteristics of the top management team and the board of directors related with corporate social performance?” Specifically, this paper studied the effect on CSP of board gender diversity (BGD), top management team gender diversity (TGD), CEO duality, percentage of nonexecutive board members, board expertise, and the incentives of renumeration using a mixed model approach. The sample is retrieved from LSEG and BoardEx, containing 77864 firm-year observations from European and North American countries for the period 2002-2022. CSP was measured as the social pillar score, and additionally its subcategories: human rights score, workforce score, community score, and product responsibility score. The results indicate a positive effect on CSP for BGD, but not TGD. Positive associations were also found for all measures of expertise and renumeration incentives. Finally, CEO duality and board independence seem to positively affect CSP. These findings may have several implications for regulators, companies, and their stakeholders.
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Faculteit der Managementwetenschappen