Achieving sustainable development goals through board size and innovation

Chindasombatcharoen, Pongsapak; Chatjuthamard, Pattanaporn; Jiraporn, Pornsit; Treepongkaruna, Sirimon

doi:10.1002/sd.2264

Cited by 38 publications

(39 citation statements)

References 151 publications

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“…In addition, the resource dependence theory explains that the board has a role to offer critical resources to the firm including legitimacy and counsel (Hillman & Dalziel, 2003). As a board needs both capabilities and experience to effectively exercise its monitoring function through evaluating management, and assessing corporate strategies and social responsibility (Hillman & Dalziel, 2003), it is commonly agreed that board characteristics have a significant impact on firm behavior and performance (e.g., Chindasombatcharoen et al, 2021; Zubeltzu‐Jaka et al, 2020). Many studies found that the background and experience of board members were very important for effective monitoring (Carpenter & Westphal, 2001) and stakeholder engagement (Fernández‐Gago et al, 2018).…”

Section: Review Of Related Literaturesmentioning

confidence: 99%

Board gender diversity, corporate social commitment and sustainability

Arayakarnkul

Chatjuthamard

Treepongkaruna

2022

Corp Soc Responsibility Env

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Building a sustainable organization is one of the most important goals in business. To build sustainability, firms need to have strong social commitment to establish valuecreating stakeholder relationships. As boards of directors play a critical role in setting strategy, providing management oversight and monitoring, it is also their responsibility to ensure the firm's commitment to its social responsibilities. With the right composition, boards can be effective in driving long-term vision and creating good stakeholder relationships, contributing to firms' social capital. In this paper, we analyze board characteristics of publicly listed US firms and find evidence that support the diversity theory. In particular, that board gender diversity (proportion of female directors) is positively associated with firms' social commitment to human rights, product responsibility, and their community and workforce, evidencing female directors' contribution to firms' sustainability. To ensure the robustness of our analysis, we conduct additional analyses including propensity score matching, entropy balancing, and instrumental-variable analysis.

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Section: Review Of Related Literaturesmentioning

confidence: 99%

Board gender diversity, corporate social commitment and sustainability

Arayakarnkul

Chatjuthamard

Treepongkaruna

2022

Corp Soc Responsibility Env

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“…However, the achievement of the Sustainable Development Goals (SDGs) comes with significant challenges (Grover et al, 2018). The studies carried out show that progress is being made towards achieving the SDGs (Chindasombatcharoen et al, 2021; Haughton & Keane, 2021; Lyytimäki et al, 2020; Sanchez‐Planelles et al, 2022), but neither the speed nor the scale are adequate to improve the current levels of poverty, hunger, education, and health that characterize certain territories as well as to reduce climate emergency or discrimination (United Nations, 2019, 2020).…”

Section: Introductionmentioning

confidence: 99%

Are institutional investors “in love” with the sustainable development goals? Understanding the idyll in the case of governments and pension funds

García‐Sánchez

Aibar‐Guzmán

Torrado

et al. 2022

Sustainable Development

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Considering the key role that companies must play to achieve the Sustainable Development Goals (SDGs), this paper aims to analyze the effect of the presence of two types of institutional investors (governments and pension funds) in large companies' ownership structure on the alignment of their sustainability strategy towards the 2030 Agenda as well as the moderating effect that firm internationalization and industry's sensitivity to stakeholder pressures have on the influence of these two institutional investors on business commitment to the SDGs. For a sample of 4089 multinational companies from 2015 to 2018, the results show that institutional ownership does matter for business commitment to the SDGs, but in a different way depending on the type of investor. Specifically, ownership by government favors commitment to the SDGs, while ownership by pension funds has a negative impact, which is partially corrected in the case of globalized companies as well as in those firms belonging to industries, which are highly sensitive to stakeholder pressures. These findings seem to suggest that institutional investors' support the implementation of the SDGs by the companies in which they invest is mainly driven by corporate complexity.

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“…However, information on corporate R&D investments are usually opaque by nature and this gives rise to agency issue between the management who is responsible for making the R&D investments and the stakeholders of the firm. Good corporate governance has shown to mitigate the agency issue (e.g., Chindasombatcharoen et al, 2021). An aspect of governance that can both address the agency issue and information opaqueness issue is blockholders—owners who have substantial holdings in the firm.…”

Section: Discussionmentioning

confidence: 99%

“…The literature underlines various factors that are instrumental in promoting innovation as well as creating value in firms. Among those factors are the institutional context (Tabrizian, 2019), owners (Pucheta‐Martinez & Chiva‐Ortells, 2018; Timur & Timur, 2015), and firm‐level governance structure (Chindasombatcharoen et al, 2021; Martinez‐Ferrero & Garcia‐Meca, 2020; Pucheta‐Martinez et al, 2019).…”

Section: Introductionmentioning

confidence: 99%

Firms' potential for economic sustainability and firm value: The moderating role of blockholders

Kyaw

Thomsen

Treepongkaruna

2022

Sustainable Development

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Firms that strive to innovate (i.e., firms that invest in research and development—R&D) have high potential for economic sustainability due to the possibility of generating new platforms of growth and future revenue. However, it is little understood whether financial markets incorporate (if at all) information on firms' potential for economic sustainability. After all, firms' information on R&D investments is very opaque. This poses a challenge to investors to incorporate into firm value any economic sustainability emanating from such information. We investigate whether blockholders, owners with at least a 5% shareholding in a firm, help reflect in firm value the firms' potential for economic sustainability. We find that active blockholders, rather than passive blockholders, help incorporate in firm value the potential for economic sustainability. Thus, active blockholders help mitigate agency problems in firms and help financial markets digest firms' potential for economic sustainability.

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Achieving sustainable development goals through board size and innovation

Cited by 38 publications

References 151 publications

Board gender diversity, corporate social commitment and sustainability

Board gender diversity, corporate social commitment and sustainability

Are institutional investors “in love” with the sustainable development goals? Understanding the idyll in the case of governments and pension funds

Firms' potential for economic sustainability and firm value: The moderating role of blockholders

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