Looking Inside the Black-Box: The Effect of Corporate Governance on Corporate Social Responsibility

Posted: 24 Nov 2015

See all articles by Tanusree Jain

Tanusree Jain

ESADE Business School

Dima Jamali

American University of Beirut

Date Written: November 19, 2015

Abstract

Manuscript Type: Review

Research Question/Issue: This study provides a systematic multi-level review of recent literature to evaluate the impact of corporate governance mechanisms (CG) at the institutional, firm, group, and individual levels on firm level corporate social responsibility (CSR) outcomes. We offer critical reflections on the current state of this literature and provide concrete suggestions to guide future research.

Research Findings/Insights: Focusing on peer-reviewed articles from 2000 to 2015, our review compiles the evidence on offer pertaining to the most relevant CG mechanisms and their influence on CSR outcomes. At the institutional level, we focus on formal and informal institutional mechanisms and at the firm level we analyze the different types of firm owners. At the group level, we segregate our analysis into board structures, director social capital and resource networks and directors’ demographic diversity. At the individual level, our review covers CEOs’ demography and socio-psychological characteristics. We map the effect of these mechanisms on firms’ CSR outcomes.

Theoretical/Academic Implications: We recommend that greater scholarly attention needs to be accorded to disaggregating variables and yet comprehending how multiple configurations of CG mechanisms interact and combine to impact firms’ CSR behavior and practices. We suggest that CG-CSR research should employ multiple-theoretical lens and apply sophisticated qualitative and quantitative methods to enable a deeper and finer-grained analysis of the CG systems and their influence on CSR. Finally, we call for cross-cultural research to capture the context sensitivities typical of both CG and CSR constructs.

Practitioner/Policy Implications: Our review suggests that for structural changes and reforms within firms to be successful, they need to be complemented by changes to the institutional makeup of the context in which firms function to encourage/induce substantive changes in corporates’ responsible behaviors.

Keywords: Corporate Governance, Corporate Social Responsibility, Corporate Social Performance, Corporate Environmental Performance, Multilevel Review

Suggested Citation

Jain, Tanusree and Jamali, Dima, Looking Inside the Black-Box: The Effect of Corporate Governance on Corporate Social Responsibility (November 19, 2015). ESADE Business School Research Paper. Available at SSRN: https://ssrn.com/abstract=2693048

Tanusree Jain (Contact Author)

ESADE Business School ( email )

Av. de Pedralbes, 60-62
Barcelona, 08034
Spain

Dima Jamali

American University of Beirut ( email )

Beirut, 0236
Lebanon

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