Governance and social responsibility: what factors impact corporate performance in a small banking-oriented country?

Abstract

Purpose This paper aims to analyze the corporate governance and corporate social responsibility (CSR) determinants of the Portuguese listed companies’ performance, considering a different point of view by managers, shareholders and other external stakeholders and investors. Design/methodology/approach To achieve this aim, the authors have used a sample of 34 nonfinancial listed companies in Euronext Lisbon between 2015 and 2020. The authors use the panel data methodology to test the hypotheses formulated according to the literature review, specifically the generalized method of moments (GMM) system estimation model proposed by Arellano and Bond (1991). Findings The main results point out that the determinants of the corporate performance vary depending on the dependent variable considered. From the managers’ perspective, the existence of an audit committee and expenses with the environment increase costs and reduce results, negatively influencing corporate performance, but the company’s maturity adds synergies in resource management and positively influences performance. Shareholders consider that gender diversity and board independence positively influence performance, whereas, for external stakeholders and long-term investors, gender diversity and the social responsibility committee harm the performance of Portuguese companies. However, environmental and social expenditures have a positive effect, showing that the market’s perception is that, in the long run, it is essential to eradicate poverty and protect the environment. Originality/value To the best of the authors’ knowledge, this study is the first one to analyze corporate governance and CSR determinants on the performance of listed Portuguese companies. This study shows that in a small banking-oriented country, there is still a long way to go in terms of increasing social responsibility and governance among different stakeholders. It is essential to promote actions that lead to effective governance and awareness of social responsibility.

The moderating role of women directors in politically connected companies on the performance of Liberian companies

“…This difference is related to the positive effect in the long-term performance variable (Tobin's). It seems that long-term investors -with an interest in the company's and therefore in Tobin's future growth opportunities (Neves, et al, 2022a(Neves, et al, , 2022b(Neves, et al, , 2022c believe that women's political relationships can be a positive sign of promoting equality and can also benefit from improved employee morale, reduced turnover and a more diverse and inclusive work culture, which can contribute to the long-term value. So, in a larger sample from the Iberian Peninsula, it is possible to see that in the long term, women's political relationships can benefit performance through better reputation and image.…”

“…This method addresses endogeneity problems that might persist when there is a correlation between the independent variables and the error term (Okoyeuzu et al, 2021); that is, said endogeneity may exist when the dependent variable can also explain the explanatory variables (Neves et al, 2022a(Neves et al, , 2022b. The GMM method allows consistent estimators to be obtained using fewer observations (Blundell and Bond, 1998).…”

“…2.2 Companies' specific characteristics 2.2.1 Company size. Although company size is a widely used variable in the literature on corporate performance, there is still no consensus vis-a-vis its sign and significance (Neves et al, 2022a(Neves et al, , 2022b. Goddard et al (2005) and Proença and Neves (2022) explain that increased company size entails less control over managers' activities, which may lead to them using their resources for their own benefit, thereby destroying company value.…”

“…The board of directors must ensure the best management for the company, protect the interests of the stakeholders and function as a control mechanism to restrict potential conflicts of interest between managers and shareholders (Vieira et al , 2019). A larger board motivates more attitudes of dominance and authority on the part of leaders, giving rise to conflicts of interest (Neves et al , 2022b). De Andres et al (2005) show that a larger board harms company performance in terms of market value, and Rodriguez-Fernandez et al (2014) also point to the same negative sign.…”

Study of the Impact of Managerial Relationships on Corporate Performance in a Transitional Environment

“…Therefore, enterprise management in a transformational environment needs to have the following characteristics: (1) flexibility: enterprises need to have a flexible and agile management model that can quickly adjust and adapt to market changes. (2) innovation: enterprises need to have an innovative and open culture to continuously promote innovation in existing business models and products/services, leading the enterprise to a higher level. (3) strategic: enterprises need to establish a long-term strategic planning to maintain strategic stability in the face of market changes.…”