IDEAS home Printed from https://ideas.repec.org/a/kap/jbuset/v114y2013i3p381-392.html
   My bibliography  Save this article

Board Composition and Corporate Social Responsibility: An Empirical Investigation in the Post Sarbanes-Oxley Era

Author

Listed:
  • Jason Zhang
  • Hong Zhu
  • Hung-bin Ding

Abstract

Although the composition of the board of directors has important implications for different aspects of firm performance, prior studies tend to focus on financial performance. The effects of board composition on corporate social responsibility (CSR) performance remain an under-researched area, particularly in the period following the enactment of the Sarbanes-Oxley Act of 2002 (SOX). This article specifically examines two important aspects of board composition (i.e., the presence of outside directors and the presence of women directors) and their relationship with CSR performance in the Post-SOX era. With data covering over 500 of the largest companies listed on the U.S. stock exchanges and spanning 64 different industries, we find empirical evidence showing that greater presence of outside and women directors is linked to better CSR performance within a firm’s industry. Treating CSR performance as the reflection of a firm’s moral legitimacy, our study suggests that deliberate structuring of corporate boards may be an effective approach to enhance a firm’s moral legitimacy. Copyright Springer Science+Business Media B.V. 2013

Suggested Citation

  • Jason Zhang & Hong Zhu & Hung-bin Ding, 2013. "Board Composition and Corporate Social Responsibility: An Empirical Investigation in the Post Sarbanes-Oxley Era," Journal of Business Ethics, Springer, vol. 114(3), pages 381-392, May.
    • Handle: RePEc:kap:jbuset:v:114:y:2013:i:3:p:381-392
    DOI: 10.1007/s10551-012-1352-0
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10551-012-1352-0
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10551-012-1352-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Monica C. Higgins & Ranjay Gulati, 2003. "Getting Off to a Good Start: The Effects of Upper Echelon Affiliations on Underwriter Prestige," Organization Science, INFORMS, vol. 14(3), pages 244-263, June.
    2. Elizabeth Webb, 2004. "An Examination of Socially Responsible Firms’ Board Structure," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 8(3), pages 255-277, June.
    3. Paul Gompers & Joy Ishii & Andrew Metrick, 2003. "Corporate Governance and Equity Prices," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(1), pages 107-156.
    4. Frank Graaf & Cor Herkströter, 2007. "How Corporate Social Performance Is Institutionalised Within the Governance Structure," Journal of Business Ethics, Springer, vol. 74(2), pages 177-189, August.
    5. Hee‐Jae Cho & Vladimir Pucik, 2005. "Relationship between innovativeness, quality, growth, profitability, and market value," Strategic Management Journal, Wiley Blackwell, vol. 26(6), pages 555-575, June.
    6. Andreas Georg Scherer & Guido Palazzo, 2011. "The New Political Role of Business in a Globalized World: A Review of a New Perspective on CSR and its Implications for the Firm, Governance, and Democracy," Journal of Management Studies, Wiley Blackwell, vol. 48(4), pages 899-931, June.
    7. Guido Palazzo & Andreas Scherer, 2006. "Corporate Legitimacy as Deliberation: A Communicative Framework," Journal of Business Ethics, Springer, vol. 66(1), pages 71-88, June.
    8. Lois Mahoney & Linda Thorn, 2006. "An Examination of the Structure of Executive Compensation and Corporate Social Responsibility: A Canadian Investigation," Journal of Business Ethics, Springer, vol. 69(2), pages 149-162, December.
    9. Ayuso, Silvia & Argandoña, Antonio, 2007. "Responsible corporate governance: Towards a stakeholder board of directors?," IESE Research Papers D/701, IESE Business School.
    10. Abagail McWilliams & Donald Siegel, 2000. "Corporate social responsibility and financial performance: correlation or misspecification?," Strategic Management Journal, Wiley Blackwell, vol. 21(5), pages 603-609, May.
    11. Dalton, Dan R. & Dalton, Catherine M., 2010. "Women and corporate boards of directors: The promise of increased, and substantive, participation in the post Sarbanes-Oxley era," Business Horizons, Elsevier, vol. 53(3), pages 257-268, May.
    12. Zhang, Jason Q. & Craciun, Georgiana & Shin, Dongwoo, 2010. "When does electronic word-of-mouth matter? A study of consumer product reviews," Journal of Business Research, Elsevier, vol. 63(12), pages 1336-1341, December.
    13. Stephen Bear & Noushi Rahman & Corinne Post, 2010. "The Impact of Board Diversity and Gender Composition on Corporate Social Responsibility and Firm Reputation," Journal of Business Ethics, Springer, vol. 97(2), pages 207-221, December.
    14. James S. Linck & Jeffry M. Netter & Tina Yang, 2009. "The Effects and Unintended Consequences of the Sarbanes-Oxley Act on the Supply and Demand for Directors," The Review of Financial Studies, Society for Financial Studies, vol. 22(8), pages 3287-3328, August.
    15. Amy J. Hillman & Gerald D. Keim, 2001. "Shareholder value, stakeholder management, and social issues: what's the bottom line?," Strategic Management Journal, Wiley Blackwell, vol. 22(2), pages 125-139, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Chung, Huimin & Lin, Jane Raung & Yang, Ying Sui, 2012. "How do entrenched managers handle stakeholders interests?," Journal of Multinational Financial Management, Elsevier, vol. 22(5), pages 263-277.
    2. Cuadrado Ballesteros, Beatriz & García Rubio, Raquel & Martínez Ferrero, Jennifer, 2015. "Efecto de la composición del consejo de administración en las prácticas de responsabilidad social corporativa," Revista de Contabilidad - Spanish Accounting Review, Elsevier, vol. 18(1), pages 20-31.
    3. McGuire, Jean & Dow, Sandra & Ibrahim, Bakr, 2012. "All in the family? Social performance and corporate governance in the family firm," Journal of Business Research, Elsevier, vol. 65(11), pages 1643-1650.
    4. Heather R. Dixon-Fowler & Alan E. Ellstrand & Jonathan L. Johnson, 2017. "The Role of Board Environmental Committees in Corporate Environmental Performance," Journal of Business Ethics, Springer, vol. 140(3), pages 423-438, February.
    5. Qinqin Zheng & Yadong Luo & Stephanie Wang, 2014. "Moral Degradation, Business Ethics, and Corporate Social Responsibility in a Transitional Economy," Journal of Business Ethics, Springer, vol. 120(3), pages 405-421, March.
    6. Eunice S. Khoo & Youngdeok Lim & Louise Y. Lu & Gary S. Monroe, 2022. "Corporate social responsibility performance and the reputational incentives of independent directors," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 49(5-6), pages 841-881, May.
    7. Claude Francoeur & Réal Labelle & Souha Balti & Saloua EL Bouzaidi, 2019. "To What Extent Do Gender Diverse Boards Enhance Corporate Social Performance?," Journal of Business Ethics, Springer, vol. 155(2), pages 343-357, March.
    8. Wenbin Long & Sihai Li & Huiying Wu & Xianzhong Song, 2020. "Corporate social responsibility and financial performance: The roles of government intervention and market competition," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(2), pages 525-541, March.
    9. Galbreath, Jeremy, 2017. "Drivers Of Environmental Sustainability In Wine Firms: The Role And Effect Of Women In Leadership," Working Papers 253851, American Association of Wine Economists.
    10. Aneta Oniszczuk-Jastrząbek & Ernest Czermański & Giuseppe T. Cirella, 2020. "Sustainable Supply Chain of Enterprises: Value Analysis," Sustainability, MDPI, vol. 12(1), pages 1-15, January.
    11. Joern H. Block & Marcus Wagner, 2014. "The Effect of Family Ownership on Different Dimensions of Corporate Social Responsibility: Evidence from Large US Firms," Business Strategy and the Environment, Wiley Blackwell, vol. 23(7), pages 475-492, November.
    12. Tolossa Fufa Gulema & Yadessa Tadesse Roba, 2021. "Internal and external determinants of corporate social responsibility practices in multinational enterprise subsidiaries in developing countries: evidence from Ethiopia," Future Business Journal, Springer, vol. 7(1), pages 1-19, December.
    13. Jonathan Taglialatela & Ivan Miroshnychenko & Roberto Barontini & Francesco Testa, 2024. "Talk or walk? The board of directors and firm environmental strategies," Business Strategy and the Environment, Wiley Blackwell, vol. 33(4), pages 2890-2910, May.
    14. Roberto Fernández-Gago & Laura Cabeza-García & Mariano Nieto, 2016. "Corporate social responsibility, board of directors, and firm performance: an analysis of their relationships," Review of Managerial Science, Springer, vol. 10(1), pages 85-104, January.
    15. Aneta Havlinova & Jiri Kukacka, 2023. "Corporate Social Responsibility and Stock Prices After the Financial Crisis: The Role of Strategic CSR Activities," Journal of Business Ethics, Springer, vol. 182(1), pages 223-242, January.
    16. Eunice S. Khoo & Li Chen & Gary S. Monroe, 2023. "Shareholder election of CSR committee members and its effects on CSR performance," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 50(3-4), pages 716-763, March.
    17. Jing Lu & Irene M. Herremans, 2019. "Board gender diversity and environmental performance: An industries perspective," Business Strategy and the Environment, Wiley Blackwell, vol. 28(7), pages 1449-1464, November.
    18. Coluccia, Daniela & Dabić, Marina & Del Giudice, Manlio & Fontana, Stefano & Solimene, Silvia, 2020. "R&D innovation indicator and its effects on the market. An empirical assessment from a financial perspective," Journal of Business Research, Elsevier, vol. 119(C), pages 259-271.
    19. Vanina Forget, 2012. "Doing well and doing good: a multi-dimensional puzzle," Working Papers hal-00672037, HAL.
    20. Nguyen Thi Thanh Binh, 2024. "An application of artificial neural networks in corporate social responsibility decision making," Intelligent Systems in Accounting, Finance and Management, John Wiley & Sons, Ltd., vol. 31(1), March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jbuset:v:114:y:2013:i:3:p:381-392. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.