Evaluating the moderating impact of family on the relationship between board independence and corporate social responsibility using propensity score matching

South African Journal of Business Management


 
 
Field Value
 
Title Evaluating the moderating impact of family on the relationship between board independence and corporate social responsibility using propensity score matching
 
Creator Anwar, Rehana Ahmed, Jaleel
 
Subject Business Management; Finance, Management Sciences corporate social responsibility (CSR) performance; board independence; family firms; propensity score matching; Chinese firms.
Description Purpose: Owing to the voluntary nature of CSR activities, the decision to participate or not could be affected by the motives of corporate directors. The purpose of this research was to investigate whether family involvement in business moderates the relationship between board independence and sustainability performance of firms.Design/methodology/approach: Firstly, propensity score matching is employed to control for the problem of potential endogeneity in the sample by generating a matched sample. Later, regression analysis is conducted on this matched sample to check for the moderating impact of family-led firms on the relation between board independence and CSR performance (CSRP) of firms.Findings/results: We document about Chinese firms with independent boards exhibiting socially responsible behaviour which shows that they serve in a monitoring capacity over the management on behalf of rest of the stakeholders. Moreover, our results show that the role of independent directors is compromised in establishing effective monitoring in family-led firms.Practical implications: Our results would help regulating agencies in designing regulatory programs by guiding them in developing customized policies for different governance and ownership systems in place. Our findings recommend that in a bid to attain improved sustainability performance, diversified shareholding may be favoured or requisite codes may be framed to enhance the social performance of firms having concentrated ownership.Originality/value: This work essentially clears the varying results in literature with regard to the relationship of board characteristics and firms’ CSRP.
 
Publisher AOSIS
 
Contributor Higher Education Commission of Pakistan.
Date 2020-05-28
 
Type info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion —
Format text/html application/epub+zip text/xml application/pdf
Identifier 10.4102/sajbm.v51i1.1854
 
Source South African Journal of Business Management; Vol 51, No 1 (2020); 10 pages 2078-5976 2078-5585
 
Language eng
 
Relation https://sajbm.org/index.php/sajbm/article/view/1854/1545 https://sajbm.org/index.php/sajbm/article/view/1854/1544 https://sajbm.org/index.php/sajbm/article/view/1854/1546 https://sajbm.org/index.php/sajbm/article/view/1854/1543
 
Coverage People's Republic of China — —
Rights Copyright (c) 2020 Rehana Anwar, Jaleel Ahmed https://creativecommons.org/licenses/by/4.0