How do firms achieve corporate social performance? An integrated perspective

Ben‐Amar, Walid; Francœur, Claude; Marsat, Sylvain; Wahid, Aida Sijamic

doi:10.1002/csr.2107

Cited by 16 publications

(13 citation statements)

References 67 publications

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“…(2019) argued that the existence of a specialised CSR committee reinforces the provision of some incentives to CEOs to promote CSR strategies. Ben-Amar et al. (2021) advocated, moreover, that firm-level CSR governance practices are positively and directly associated with firm social performance through the establishmentof a dedicated CSR committee within the board.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Women leaders and corporate social performance: do critical mass, CEO managerial ability and corporate governance matter?

Jouber

2022

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PurposeThis study aims to investigate the impact of top management team (TMT)'s gender diversity on corporate social performance (CSP). It sheds light on inconsistent results in literature by testing the moderator effects of chief executive officer (CEO) managerial ability and corporate governance (CG) on such impact.Design/methodology/approachA dynamic panel estimator is applied to an international sample of 8640 firm‐year observations from 2013 to 2017.FindingsThe author finds reliable evidence that the critical mass of at least three women leaders has a positive impact on the firm's CSP. Obtained results suggest, moreover, the deterrence effects of CEO managerial ability and CG tools (board independence, board gender diversity, the presence of a corporate social responsibility committee and family control) on the women leaders' contribution to the firm's CSP level. These results remain consistent with alternative measures for women leaders and CEO managerial ability. However, findings are lost when women achieve the CEO position, the chairperson position or both positions, which imply that men and women leadership styles are closely similar rather than different. Furthermore, women leaders' effect on CSP seems dependent (do not) on the country (industry) which a firm belongs to.Practical implicationsFrom a practical standpoint, the study highlights the importance of fostering the achievement of a critical mass of women leaders and the combination of CEO managerial ability – educational/professional backgrounds – and CG attributes to improve the firm's CSP. The study has important implications for investors and regulators. If investors wish to increase CSP, they should ask for more gender diversified TMTs. Furthermore, this study supports regulators in their efforts to increase senior women's quotas by providing empirical evidence of better social outcomes under leader gender diversity. The study’s evidence is also useful for companies in setting the criteria to identify CEOs who can support their strategic decisions.Originality/valueBy studying the impact female leaders have on CSP under CEO managerial ability and CG as moderators, this study is the first to display complementarities and substitutions between CEO's managerial ability and selected CG attributes in the promotion of CSP by female senior executives. Furthermore, it fills the void on how TMT's gender diversity impact CSP. In fact, while it is conventionally considered that women are more likely to engage in socially responsible activities, sensitive findings of this study shed light on the brighter side of female executives when they achieve the CEO, the chairperson position or both positions.

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Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Women leaders and corporate social performance: do critical mass, CEO managerial ability and corporate governance matter?

Jouber

2022

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“…Several prior studies on CEO behavior posit 1 The effect of CEO characteristic (e.g., gender, age, and political preferences) and other factors surrounding corporation (e.g., religion) on CSR activities are well-studied (see, e.g., Borghesi et al, 2014;Chin et al, 2013;Cronqvist & Yu, 2017;Manner, 2010;Petrenko et al, 2016;Su, 2019;Zhang et al, 2013). Additionally, there are many recent studies on the determinants or consequences of CSR (see, e.g., Bae et al, 2021;Ben-Amar et al, 2021;Lee et al, 2016;Park & Lee, 2021;Shin et al, 2021). that a CEO's strong wealth alignment with shareholders wealth (proxied by delta) affects corporate investment (e.g., Coles et al, 2006;Guay, 1999).…”

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confidence: 99%

Corporate social responsibility and the alignment of CEO and shareholders wealth: Does a strong alignment induce or restrain CSR?

Kim

Mun

Han

2022

Corp Soc Responsibility Env

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We examine whether a strong alignment of the chief executive officer (CEO) and shareholders wealth induces or restrains the firm's corporate social responsibility (CSR) engagement. CSR can enhance shareholders wealth consistent with stakeholder theory. However, CEOs maximizing their own utilities have an incentive to overinvest corporate resources for CSR engagement at shareholders' expense. Therefore, the strong alignment of the CEO and shareholders wealth is expected to lead the CEO to engage less in some CSR activities, particularly those are questionable to enhance shareholders wealth or those are only good for the CEO's private benefit.Empirically, we find that firms with strongly aligned CEOs are less likely to strengthen CSR activities for external stakeholders such as the environment, community, and human rights. This suggests that strengthening CSR for external stakeholders appears to be the consequence of agency problem rather than stakeholder theory. Overall, we argue that CEO-shareholders wealth alignment has a non-monotonic impact on CSR activities, and it can effectively mitigate the agency problem by restraining overinvestment in some CSR activities that may harm shareholders wealth.

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“…In this setting, stakeholders have a limited opportunity to enforce their interests related to corporate carbon emissions. To the extent that a company intends to effectively respond to stakeholder demands, corporate governance instruments that are focused on corporate social responsibility can counterbalance shareholder-friendly institutional parameters (Ben-Amar et al , 2021). Hence, in this case, the board-level decision to implement a sound carbon-related CEO compensation can help mitigate carbon-related stakeholder utility loss.…”

Section: Discussionmentioning

confidence: 99%

Mapping the determinants of carbon-related CEO compensation: a multilevel approach

Winschel

2021

SBR

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Purpose In view of the current climate change emergency and the growing importance of the climate-related accountability of companies, this paper aims to advance a comprehensive understanding of the determinants of carbon-related chief executive officer (CEO) compensation. Design/methodology/approach Building on the agency-theoretical perspective on executive compensation and existing work in the fields of management, corporate governance, cultural studies, and behavioral science, this paper derives a multilevel framework of the determinants of carbon-related CEO compensation. Findings This paper maps the determinants of carbon-related CEO compensation at the societal, organizational, group, and individual levels of analysis. It also provides research propositions on the determinants that can support and challenge the implementation of this instrument of environmental corporate governance. Originality/value In the past literature, the determinants of carbon-related CEO compensation have remained largely unexplored. This paper contributes to the academic discussion on environmental corporate governance by showcasing the role of interlinkages among the determinants of carbon-related CEO compensation and the possible countervailing impacts. In view of the complex interdisciplinary nature of climate change impact, this paper encourages businesses practitioners and regulators to intensify their climate change mitigation efforts and delineates the levers at their disposal.

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How do firms achieve corporate social performance? An integrated perspective

Cited by 16 publications

References 67 publications

Women leaders and corporate social performance: do critical mass, CEO managerial ability and corporate governance matter?

Women leaders and corporate social performance: do critical mass, CEO managerial ability and corporate governance matter?

Corporate social responsibility and the alignment of CEO and shareholders wealth: Does a strong alignment induce or restrain CSR?

Mapping the determinants of carbon-related CEO compensation: a multilevel approach

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