Board Network Centrality and Corporate Social Responsibility

52 Pages Posted: 24 Sep 2019 Last revised: 5 Mar 2020

See all articles by Lai Van Vo

Lai Van Vo

Western Connecticut State University

Huong T. T. Le

Northeastern Illinois University

Youngbin Kim

affiliation not provided to SSRN

Date Written: March 4, 2020

Abstract

The previous business literature mainly investigates the effects of board network on the financial performance of firms. In this paper, we contribute to the literature by examining its impact on firm non-financial performance. We find that firms with central or well-connected boards of directors invest more in corporate social responsibility (CSR). We show that this impact is stronger for firms with strong corporate governance, high institutional ownership, or high public awareness. Moreover, this positive effect is also more pronounced for firms that need high commitment of stakeholders to success, such as firms with larger investments in research and development (R&D) or those in more competitive industries. These findings are consistent with the view that well-connected boards are positively associated with better monitoring and advising.

Keywords: board interlock, board network centrality, corporate social responsibility

JEL Classification: G30, G14, L14, Z13

Suggested Citation

Vo, Lai Van and Le, Huong T. T. and Kim, Youngbin, Board Network Centrality and Corporate Social Responsibility (March 4, 2020). Available at SSRN: https://ssrn.com/abstract=3453776 or http://dx.doi.org/10.2139/ssrn.3453776

Lai Van Vo (Contact Author)

Western Connecticut State University ( email )

Danbury, CT 06810
United States
203-837-9379 (Phone)

Huong T. T. Le

Northeastern Illinois University ( email )

Chiago, IL 60625
United States

Youngbin Kim

affiliation not provided to SSRN

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