Keywords: Corporate social responsibility; Corporate governance; Chaebol; Electronic voting system; Difference-in-differences; Propensity score matching
학회소식
[2018년 제 3차] Does Better Corporate Governance Foster CSR Activities?
작성자 : 관리자
조회수 : 191
게시일 :
2018-08-23
This study examines the effect of corporate governance(CG) quality on corporate social responsibility (CSR) activities in Korea. CG and CSR activities are evolving in Korea, which has a financial market characterized by a strong presence of business conglomerates (
chaebols
). We find that CG quality has a positive influence on CSR activities, implying that the long-term benefits of CSR activities are greater than their associated costs, and that well-functioning CG practices foster CSR activities. The positive influence is driven largely by the quality of a firm’ s board, protection of shareholder rights, and audit committee. We also find that the positive CG
–
CSR association is more evident in
chaebol
-affiliated firms, suggesting that sound CG practices are more effective in promoting CSR activities when there is a possible misalignment between management and stakeholder interests, supporting the stakeholder theory. Our main findings still hold after various robustness tests, including a difference-in-differences analysis of the changes in Korean CG regulations and an analysis based on propensity score matching. Overall, we reveal the crucial role of the CG
–
CSR nexus in Korea, where enhancing the quality of CG and engaging actively in CSR activities have become increasingly important for firms’ long-term sustainability.
