Investigating corporate governance and corporate social responsibility nexus in emerging economy: A structural equation approach

Abstract

The nexus between corporate social responsibility (CSR) and corporate governance (CG) has received negligible attention in emerging economies (Zaman, Jain, Samara, & Jamali, 2022; Jahid, Rashid, Hossain, Haryono, & Jatmiko, 2020). This study examines the relationship between CG and CSR in emerging economies. This study used a survey method to collect data from 220 top executives of selected firms in Ghana using questionnaires. The collected data were analyzed using Amos software. Structural equation modelling (SEM) was used to test the hypothesis. The study employed upper echelons theory to build the theoretical foundation and demonstrated that CG is a predominant predictor of CSR. As a result, the findings of the study show that CG has an important influence in catalyzing or curtailing CSR initiatives. Firms that pursue quality CG systems and practices are more likely to pursue better CSR initiatives. The implication for firms is that they need to carefully constitute CG systems and structures as they significantly enhance CSR implementation. Firms that want a better outcome from CSR programs must prioritize the implementation of CG systems and procedures that promote reciprocal exchanges with stakeholders. This study is among the first to examine the interdependency of CG and CSR in Ghana using the upper echelons theory

Does Institutional Ownership Moderate the Relationship Between Audit Committee Composition and Audit Report Lag: Evidence From Saudi

“…The evidence suggests that the moderator variable (institutional ownership) exerts a significant adverse effect on audit report lag, supporting H5 . This finding indicates that institutional investors usually design prudent investment strategies and actively monitor managers to ensure their plan is actualized (Boshnak, 2023b; Ledi & Ameza – Xemalordzo, 2023). Consequently, companies with a higher ratio of institutional shareholding may minimize financial misstatement, leading to a lower audit report lag (Basuony et al, 2016; Mitra et al, 2012).…”

“…These investors are relatively more active in monitoring the actions of managers because of their keen interest in maximizing their investment value (AbdulJalil & AbdulRahman, 2010; Boshnak, 2023b; Jensen, 1989). These investors closely monitor managers’ policies and scrutinize their proposals extensively due to their sophisticated financial expertise and management skills (Ledi & Ameza – Xemalordzo, 2023; Switzer & Wang, 2017). They usually design prudent investment strategies and monitor managers to ensure their plans are actualized.…”

“…Institutional investors usually pressure managers to disclose vital information to the public and exercise due diligence when scrutinizing management proposals (Basuony et al, 2016; Le & Nguyen, 2023). This high disclosure may reduce the information gap between firms and outsiders, thereby mitigating agency conflicts (Ledi & Ameza – Xemalordzo, 2023). They have a fiduciary role in firms’ governance and may use their voting power to influence board compositions (Boshnak, 2023b; Thi, 2023).…”