Marwan Ahmad Al-Shammari, Soumendra Banerjee, Tushar R. Shah, Harold Doty and Hussam Al-Shammari
In light of the conflict between scholarly findings supporting corporate social responsibility’s positive impact on corporate financial performance (CFP) versus findings showing…
Abstract
Purpose
In light of the conflict between scholarly findings supporting corporate social responsibility’s positive impact on corporate financial performance (CFP) versus findings showing negative impact on CFP, the academic literature has reoriented toward determining the contingency conditions that affect the underlying relationships. This paper aims to investigate two potential contingency factors, the chief executive officer’s (CEO) corporate social responsibility (CSR) expertise and board members’ CSR expertise.
Design/methodology/approach
This paper uses an unbalanced panel of archival data of 168 firms from the S&P 500 index for the period 2006–2013. The analytic model is estimated using the feasible generalized least squares regression method with heteroscedasticity and panel-specific AR1 autocorrelation.
Findings
The findings reinforce the perspective that CSR positively affects the firm’s financial performance. The authors find that firms realize optimal results from their CSR investments when both the board and the CEO have greater CSR expertise. In other words, both, CEO CSR expertise and board CSR expertise positively impact the CSR–CFP relationship.
Research limitations/implications
The findings of this study advance the literature in three important areas, namely, the social responsibility–financial responsibility relationship, the governance literature and upper echelons theory. First, the theoretical arguments and the empirical evidence highlight that CSR–CFP relationship is at least partly contingent upon the CEO’s and board members’ CSR expertise. Second, this study introduces two important variables: the CEO and board’s CSR experience as proxies for their CSR expertise. Future researchers may consider decomposing the various components of CSR to study the differential impact of each component on financial performance.
Practical implications
First, this study finds that while the CEO CSR expertise may be of value for the firm, such value can only be realized under a capable and effective board that has adequate knowledge in the field of CSR. Second, this study shows that the best-case scenario for firms occurs when both its board members and CEO have had greater prior CSR involvement that contributed to their knowledge inventory and skills. Greater knowledge and skills enhance the quality of the decisions that comprise the firm’s CSR strategy.
Originality/value
While it seems intuitive that prior CSR knowledge and expertise should lead to more and better CSR initiatives, there are few if any studies that empirically examine the effects of this premise on a firm’s financial performance. To the best of the authors’ knowledge, this study appears to be the first that directly tests the relationship between executives’ CSR experience and firm performance.
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John James Cater, Marilyn Young, Marwan Al-Shammari and Kevin James
Using the theory of planned behavior as a theoretical base, this study aims to examine the effect of the personality attributes, risk-taking, creativity and locus of control on…
Abstract
Purpose
Using the theory of planned behavior as a theoretical base, this study aims to examine the effect of the personality attributes, risk-taking, creativity and locus of control on the entrepreneurial intentions of US business college students. The authors replicated previous studies from around the world but performed the research during the Covid-19 pandemic.
Design/methodology/approach
The authors surveyed 353 students, comparing those with entrepreneurial intentions (n = 213) versus those without entrepreneurial intentions (n = 140).
Findings
The authors found that risk-taking and creativity both significantly and positively predicted entrepreneurial intentions, but locus of control did not have a significant impact.
Practical implications
Contextually, the authors performed this study during the widespread complications of the Covid-19 pandemic. The authors advise business educators to initiate programs that encourage student entrepreneurship by nurturing creativity and offering educational resources that assist students in reducing the perceived risk of entrepreneurship.
Originality/value
The authors seek to increase awareness among business educators of the significance of entrepreneurship as a desirable career. The authors believe that one impact from the Covid-19 pandemic has been an expanded interest among students to start their own businesses. The authors propose that creative measures introduced into the business school curriculum by business educators will enhance students’ desire to take risks to create their own businesses.
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Shiquan Wang, Xuantong Wang and Qianlin Li
Face is the most intuitive and representative feature at the individual level. Many studies show that beautiful faces help individuals and enterprises obtain economic benefits and…
Abstract
Purpose
Face is the most intuitive and representative feature at the individual level. Many studies show that beautiful faces help individuals and enterprises obtain economic benefits and form a high economic premium, but the discussion of their potential social value is insufficient. This study aims to focus on the impact of the personal characteristics of executives. It mainly analyzes the impact mechanism of CEO facial attractiveness on corporate social responsibility (CSR) decision-making, clarifying the social value of beauty from the perspective of CSR.
Design/methodology/approach
The authors use the regression model to analyze the panel data set, which was conducted by a sample of Chinese publicly listed firms from 2016 to 2018.
Findings
The study found that CEOs with high facial attractiveness are more active in fulfilling CSR, which can usually bring higher social benefits. CEOs with beautiful faces are prone to overconfidence, are optimistic about their ability and the future development of the enterprise and are more willing to increase their investment in CSR. CEO duality can positively regulate the positive correlation between a CEO’s facial attractiveness and CSR.
Originality/value
Based on the perspective of upper echelons theory, this paper explores the mechanism of CEO facial attractiveness on CSR. This study enriches the perspective of the upper echelon’s theoretical research and has essential enlightenment for CEO selection and training practice.
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Zeyu Li, Mazlina Mustapha, Ahmad Fahmi Sheikh Hassan and Saidatunur Fauzi Saidin
This study examines the impact of corporate governance on succession planning and organizational performance. Drawing on agency theory, the main purpose of this study is to…
Abstract
Purpose
This study examines the impact of corporate governance on succession planning and organizational performance. Drawing on agency theory, the main purpose of this study is to identify the effect of corporate governance on succession planning by measuring the different characteristics of the board of directors.
Design/methodology/approach
This multi-quantitative research used primary and archival data. A total of 281 valid questionnaires were collected from Chinese listed family firms to gauge succession planning. Relevant archival data were obtained to measure board characteristics and organizational performance. All hypotheses were examined through structural equation modeling.
Findings
The outcomes indicate that corporate governance positively influences succession planning and, in turn, boosts superior organizational performance, which uncovers the mediating effect of succession planning on the relationship between corporate governance and organizational performance. Our findings reveal that board independence and education facilitate the development of succession planning, which is crucial in the family business’s life cycle.
Originality/value
The results of this study contribute to management succession, strategic management and leadership research by demonstrating how corporate governance fosters organizational performance through succession planning, thereby expanding the application scenarios of agency theory in family firms. Additionally, the article also enriches our understanding of how family businesses apply sound governance structures to promote organizational strategic decision-making during the succession process.
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The authors examine how the major board reforms recently implemented by countries around the world affect firms' choice of debt.
Abstract
Purpose
The authors examine how the major board reforms recently implemented by countries around the world affect firms' choice of debt.
Design/methodology/approach
Using a quasi-experimental setting of major board reforms around the world that aim to improve board-related governance practices in various areas, this study investigates the impact of effective board monitoring on corporate debt choice. The authors employ difference-in-differences-type quasi-natural experiment method and path analysis for hypotheses testing.
Findings
The authors find that the implementation of board reforms is positively associated with firms' preference for public debt financing over bank debt. However, this effect tends to weaken after the fourth year following the implementation of board reforms. In additional analyses, the authors find that “rule-based” reforms have a more pronounced effect on firms' choice of debt than do “comply-or-explain” reforms. Both (1) strengthened firm-level internal governance practices that address concerns about the agency cost of debt and (2) reduced information asymmetries play important roles in facilitating firms' debt choice, but the evidence suggests that the former is the economic mechanism through which country-level reforms affect corporate debt choice.
Research limitations/implications
The study extends the literature examining the heterogeneity of corporate debt choices in a global setting and the literature on the consequences of corporate governance reforms.
Practical implications
The findings demonstrate the effectiveness of the corporate board reforms implemented in countries around the world, addressing concerns from critics about their potential harm or ineffectiveness.
Originality/value
The results indicate that country-level board reforms reduce the extent to which shareholder–creditor conflicts harm shareholders.