Corporate Social Responsibility (CSR) and Risk Taking: Evidence from Indonesia

Mulia, Rezki Ananda; Joni, Joni

doi:10.35944/jofrp.2019.8.1.010

Cited by 10 publications

(6 citation statements)

References 21 publications

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“…The mean of CSR_COM is 0,679, with a minimum score of 0.000 and a maximum score of 0.900. Consistent with prior studies (Harjoto and Laksmana, 2018;Mulia and Joni, 2019), the index score of CSR_COM in the sample is considered reasonable.…”

Section: Empirical Findings 51 Descriptive Statisticssupporting

confidence: 69%

Political affiliation types and corporate social responsibility (CSR) commitment: evidence from Indonesia

Selin

Joni

Ahmed

2022

JAOC

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Purpose This study aims to examine the association between political affiliation types and corporate social responsibility (CSR) commitment for listed companies in Indonesia stock exchange (emerging economy) from 2015 to 2017. Design/methodology/approach The final sample of this research is 1,121 firm-year observations across industries, except the financial sector, because they are under different regulations. To estimate the association, ordinary least square regression is used. Also, the authors check our results using an alternative measure of political affiliations, additional control variables and the generalized method of moment model for endogeneity problems. Findings The result indicates that corporate political affiliations, particularly through military and industry-specialized people, have a significantly positive effect on CSR commitment. After testing for endogeneity problems, the findings remain similar. Research limitations/implications This study implies to the literature by providing empirical findings on how different types of political connections, particularly affiliation through board members with the specifically industry-specialized person and military, influence CSR commitments. Also, the authors show an exchange relationship between government and affiliated firms as the primary external motivation for performing CSR in Indonesia. When investors, creditors and policymakers comprehend the political incentives behind CSR performance, it can enable them to create better business valuations and effective CSR strategies in developing countries. However, this study is subject to several limitations. First, the authors do not examine the effect of a different regime with different types of power. Second, the qualitative aspect of the association between political affiliation and CSR is not explored yet. Originality/value The authors investigate the impact of several types of political affiliations on the nonfinancial outcome (CSR) in the context of an emerging country where business practices are heavily influenced by political connections and the military’s dominance.

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Section: Empirical Findings 51 Descriptive Statisticssupporting

confidence: 69%

Political affiliation types and corporate social responsibility (CSR) commitment: evidence from Indonesia

Selin

Joni

Ahmed

2022

JAOC

Self Cite

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“…As a result, risk reduces the positive impact of CEO dominance on CSR engagement. This is consistent with the findings of Jo and Na (2012), Harjoto and Laksmana (2018) and Mulia and Joni (2019). Individual morale is predicted to rise because of high CSR participation, encouraging stakeholders to become more invested in the bank.…”

Section: Empirical Findings and Discussionsupporting

confidence: 87%

CEO behavior and CSR engagement: the moderating role of bank risk-taking

Jilani

Chouaibi

Kouki

2023

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Purpose The main purpose of this paper is to look at the link between chief executive officer (CEO) behavior and corporate social responsibility (CSR) engagement with the moderating role of bank risk-taking behavior. Design/methodology/approach Based on a 13-year data set (2007–2019), the authors applied the feasible generalized least squares with panel data to test the hypotheses. Findings The findings reveal a positive and significant link between CEO behavior and CSR engagement. Based on these findings, it can be argued that the characteristics of the CEO of the banks would improve the CSR strategies. Furthermore, the study suggests a moderating effect of bank risk-taking in the link between psychological bias and corporate social responsibility engagement (CSR engagement). Practical implications As CEO behavioral characteristics are essential to understanding CSR practice, boards of directors should consider the behavioral traits of dominant and overconfident CEOs while designing CSR practices. Social implications If the bank behaves in a socially responsible manner, direct and indirect stakeholders may be able to evaluate the level of risk-taking in more detail. Originality/value This research highlights the importance of CEO behavior characteristics for CSR, which is a crucial application that supports the upper echelons theory; and fills a gap in literature research. It is one of the few studies examining the interaction between risk-taking, CEO behavior and CSR engagement.

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“…Consistent with prior studies (e.g. Harjoto and Laksmana 2018;Mulia and Joni 2019), the magnitude of the operating and market risks are reasonable. Also, we estimate pairwise Pearson correlations to investigate the correlations among main variables in both models, except for the industry and year dummies (Table 4).…”

Section: Descriptive Statisticssupporting

confidence: 85%

The Effectiveness of Qualified Independent Supervisory Boards : Evidence from Indonesia

Joni¹,

Natalia

En³

et al. 2021

JASET

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The objective of our empirical research is to examine the characteristics of independent supervisory board (SB) on corporate’s risk in dual tier corporate board setting, Indonesia from 2015-2017. This study is different with previous literature in several ways. First, we examine the value of qualified independent SBs in Indonesian dual board setting, while previous studies focus on one-tier board system and developed countries. Second, we also test the effectiveness of several characteristics of qualified independent supervisory board, including size, financial expertise, and tenure on operating and market risks. Based on 1,089 firm-year observations, the results suggest that both independent SB size and financial expertise help company to reduce operating and market risks. Further, we find that independent SB tenure is negatively associated with operating risk. Our results are robust after addressing endogeneity problem.

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Corporate Social Responsibility (CSR) and Risk Taking: Evidence from Indonesia

Cited by 10 publications

References 21 publications

Political affiliation types and corporate social responsibility (CSR) commitment: evidence from Indonesia

Political affiliation types and corporate social responsibility (CSR) commitment: evidence from Indonesia

CEO behavior and CSR engagement: the moderating role of bank risk-taking

The Effectiveness of Qualified Independent Supervisory Boards : Evidence from Indonesia

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