Abdulsamad Alazzani, Ahmed Hassanein and Yaseen Aljanadi
This study is guided by the upper echelon theory and argues that the role of females on boards of directors may differ between cultures. In a culture where the community has a…
Abstract
Purpose
This study is guided by the upper echelon theory and argues that the role of females on boards of directors may differ between cultures. In a culture where the community has a significant humane orientation, female directors may pay much more attention to the social issues of corporate sustainability rather than environmental issues. Therefore, this study aims to differentiate between the social and environmental performances of companies to examine whether the presence of females on the boards of directors of Malaysian firms could affect social and environmental performances differently.
Design/methodology/approach
This study uses a sample of firms listed in Bursa Malaysia and develops two disclosure indices to measure social and environmental performances. Three proxies of female directors are used in the empirical models. The ordinary least square model is used to test the hypothesis.
Findings
The empirical results suggest a positive association between social performance and the presence of female directors on the board of directors of Malaysian firms. However, no association was found between environmental performance and the presence of female directors on those boards. These results confirm the prediction of this study that the female directors of Malaysian firms pay more attention to social issues than to environmental ones.
Originality/value
This is the first study to examine the effects of the presence of female directors on Malaysian firms’ boards of directors on social and environmental performance. It also contributes to the upper echelon theory by illuminating the importance of gender diversity in influencing the social and environmental behaviors of corporate leaders. The results provide the important implication that the association between a firm’s social and environmental performance and gender diversity depends on the culture within which the company operates.
Details
Keywords
Abdulsamad Alazzani, Yaseen Aljanadi and Obeid Shreim
Drawing on servant leadership theory, this study aims to investigate whether the presence of royal family members on boards of directors impacts corporate social responsibility…
Abstract
Purpose
Drawing on servant leadership theory, this study aims to investigate whether the presence of royal family members on boards of directors impacts corporate social responsibility (CSR) reporting.
Design/methodology/approach
CSR scores from a Bloomberg database are used and royal family data are collected from annual reports. The required analyses to test the hypotheses of this study have been performed.
Findings
The findings demonstrate a positive relationship between the presence of royal family directors and CSR reporting.
Originality/value
This study seeks to contribute to the literature on servant leadership theory and CSR by highlighting the impact of royal family directors on CSR reporting. This study may also contribute to an understanding of royal family leadership as a predictor of CSR reporting.
Details
Keywords
The purpose of this paper is to investigate the direct and indirect relationship between board gender diversity and corporate tax avoidance using corporate social responsibility…
Abstract
Purpose
The purpose of this paper is to investigate the direct and indirect relationship between board gender diversity and corporate tax avoidance using corporate social responsibility (CSR) as a mediating variable.
Design/methodology/approach
This study uses a panel dataset of 200 French firms listed during 2007–2018 period. The direct and indirect effects between board gender diversity (BGD) and tax avoidance were tested by using structural equation model analysis.
Findings
The results indicate that the presence of women on corporate boardrooms negatively affects tax avoidance. The greater the proportion of women in boards, the lower the likelihood of tax avoidance practice. In the mediation test, CSR appears to partially mediate the link between women on boards and corporate tax avoidance. Additional analysis shows that the social dimension of CSR produces this mediating effect.
Practical implications
The results have practical implications for companies in regulating the composition of their boards. To benefit from diversity, firms have to increase women‘s percentage in their boards of directors. Also, investors are encouraged to pay attention to the percentage of female directors when investing and purchasing shares.
Social implications
This study proved empirically that the higher proportion of female directors significantly reduces the possibility of tax avoidance either directly or indirectly through enhancing CSR performance. The findings show that firms with gender diversified boards are more likely to get involved in CSR for hedging against the potential consequences of aggressive tax avoidance practices. In light of the above results, firms are well-advised to strongly apply the policy encouraging or mandating women as board members to take advantage of their expected benefits.
Originality/value
The originality of this paper consists in proposing the establishment of both direct and indirect relationships between BGD and corporate tax avoidance through CSR. Unlike prior studies that have been examining the direct relationship between corporate governance mechanisms and corporate tax avoidance, this study went further to investigate the indirect relationship between these two constructs. This study also differs from prior studies as it examines the effect of BGD on each of constituting pillars of CSR, namely, environmental, social and governance. To date, an extensive part of CSR research has used the combined score of CSR, but the effects on different CSR pillars remain little investigated.