Corporate governance and performance in socially responsible corporations in South Africa: new empirical insights from a multi-theoretical perspective
Ntim, Collins G. and Soobaroyen, Teerooven (2012) Corporate governance and performance in socially responsible corporations in South Africa: new empirical insights from a multi-theoretical perspective. Southampton, GB, University of Southampton (Submitted)
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Manuscript Type: Empirical
Research Question/Issue: This paper investigates the link between corporate governance (CG) and corporate social responsibility (CSR), and consequently, examines whether CG can moderate the association between corporate financial performance (CFP) and CSR.
Research Findings/Insights: Using a sample of large South African listed corporations from 2002 to 2009, we find that, on average, better-governed corporations tend to pursue a more socially responsible agenda through increased CSR practices. We also find that a combination of CSR and CG practices has a stronger positive effect on CFP than CSR alone, implying that CG positively moderates the CFP-CSR relationship. Our results are robust to controlling for different types of endogeneities, as well as alternative CFP, CG and CSR proxies.
Theoretical/Academic Implications: The paper generally contributes to the literature on CG, CSR and CFP. Specifically, we make two main new contributions to the extant literature by drawing on new insights from a modified Chen and Roberts’ (2010) multi-theoretical framework within a unique institutional, CG and CSR context. First, we show why and how better-governed corporations are more likely to pursue a more socially responsible agenda. Second, we provide evidence on why and how CG might moderate the connection between CFP and CSR.
Practical/Policy Implications: Our findings have important implications for corporate regulators and policy-makers, particularly for those in other emerging countries facing socio-economic challenges that are currently planning to pursue CG and CSR policy reforms. Since our evidence suggests that better-governed corporations are more likely to be more socially responsible with positive effect on CFP, it provides corporate regulators and policy-makers in other developing countries currently contemplating to pursue CG reforms with a strong motivation to do so formally and jointly with CSR reforms.
Keywords: Corporate Governance, Corporate Social Responsibility, Corporate Financial Performance, Multiple Theoretical Perspective, South Africa
|Item Type:||Monograph (Working Paper)|
|Subjects:||H Social Sciences > HF Commerce > HF5601 Accounting
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HT Communities. Classes. Races
|Divisions:||Faculty of Business and Law > Southampton Management School > Accounting
|Date Deposited:||16 Oct 2012 10:53|
|Last Modified:||16 Oct 2012 10:53|
|Publisher:||University of Southampton|
|RDF:||RDF+N-Triples, RDF+N3, RDF+XML, Browse.|
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