Asia-Pacific Journal of Business (아태비즈니스연구)

KNU The Institute of Management & Economy Research (강원대학교 경영경제연구소)
권호 표지
DOI QR코드

DOI QR Code

Corporate Social Responsibility and Firm Performance: the Moderating Role of Top Management Team Characteristics and Heterogeneity

  • Meng, La-Mei (Division of Accounting, Zhengzhou University of Industrial Technology) ;
  • Byun, Hae-Young (Division of Business Administration and Accounting, Kangwon National University)
  • Received : 2021.05.30
  • Accepted : 2021.06.23
  • Published : 2021.06.30
Download PDF
⟨ Previous Next ⟩

Abstract

Purpose - The purpose of this paper is exploring whether the characteristics and heterogeneity of the TMT play a moderating role in CSR and corporate value or not. Design/methodology/approach - The literature research method includes collecting, organizing, and analyzing the literature on the characteristics and heterogeneity of the TMT, the effect of corporate social responsibility (CSR), and corporate value. We analyze the contributions and limitations in existing research, grasp the current research status, and develop the research content of this article. The empirical analysis method is based on the data of Chinese A-share listed companies from 2001 to 2017. This allows us to study the moderating effect of the characteristics and heterogeneity of the TMT on CSR and corporate value. Findings - The TMT age, education degree, overseas background, and compensation have a positive moderating effect on CSR and corporate market value. The comprehensive heterogeneity of the TMT also has a positive effect on CSR and financial performance. Research implications or Originality - The research on the relationship between CSR and corporate value is still inconclusive. Some results have found a positive relationship, while others show a negative relationship. Studies exist that report mixed findings as well. This study has attempted to clarify this problem by adding potentially missing variables related on the TMT characteristics and heterogeneity, investigating causality effects.

Keywords

References

  1. Allison, P. D. (1978), "Measures of Inequality", American Sociological Rview, 43(6), 865-880. https://doi.org/10.2307/2094626
  2. Blau, P. M., (1977),"Inequality and Heterogeneity: A Primitive Theory of Social Structure ", Vol. 7. New York: Free Press.
  3. Boone, C., W. V. Olffe, A. V. Witteloostuij and B. D. Brabande (2004), "The Genesis of Top Management Team Diversity: Selective Turnover among Top Management Teams in Dutch Newspaper Publishing, 1970-94", Academy of Management Journal, 47(5), 633-656. https://doi.org/10.2307/20159609
  4. Byun, H. (2018), "Impact of ESG Factors on Firm Value in Korea" The Journal of International Trade & Commerce, 14(5), 135-160.
  5. Chen, Y. and J. Jermias (2014), "Business Strategy, Executive Compensation and Firm Performance", Accounting & Finance, 54(1), 113-134. https://doi.org/10.1111/j.1467-629X.2012.00498.x
  6. Darmadi, S. (2013a), "Board Members' Education and Firm Performance: Evidence from a Developing Economy", International Journal of Commerce and Management, 23(2),113-115. https://doi.org/10.1108/10569211311324911
  7. Darmadi, S. (2013b), "Do Women in Top Management Affect Firm Performance? Evidence from Indonesia", Corporate Governance: The International Journal of Business in Society, 13(3), 288-304. https://doi.org/10.1108/CG-12-2010-0096
  8. Eagly, A. H. and L. L. Carli (2003), "The Female Leadership Advantage: An Evaluation of the Evidence", The Leadership Quarterly, 14(6), 807-834. https://doi.org/10.1016/j.leaqua.2003.09.004
  9. Edmondson, A. C., M. A. Roberto and M. D. Watkins (2003), "A Dynamic Model of Top Management Team Effectiveness: Managing Unstructured Task Streams", The Leadership Quarterly, 14(3), 297-325. https://doi.org/10.1016/S1048-9843(03)00021-3
  10. Finkelstein, S. and D. C. Hambrick (1996), "Strategic Leadership: Top Executives and Their Effects on Organizations", Minneapolis, MN: West Publishing Company.
  11. Giannetti, M., G. Liao and X. Yu (2015), "The Brain Gain of Corporate Boards: Evidence from China", The Journal of Finance, 70(4), 1629-1682. https://doi.org/10.1111/jofi.12198
  12. Hambrick, D. C.,\ and P. A. Mason (1984), "Upper Echelons: The Organization as a Reflection of its Top Managers", Academy of Management Review, 9(2), 193-206. https://doi.org/10.5465/AMR.1984.4277628
  13. Handajani, L., B. Subroto, T. Sutrisno and E. Saraswati (2014), "Does Board Diversity Matter on Corporate Social Disclosure? An Indonesian Evidence", Journal of Economics and Sustainable Development,
  14. Harjoto, M. A. and H. Jo (2015), "Legal vs. Normative CSR: Differential Impact on Analyst Dispersion, Stock Return Volatility, Cost of Capital, and Firm Value", Journal of Business Ethics, 128(1), 1-20. https://doi.org/10.1007/s10551-014-2082-2
  15. Harjoto, M. and I. Laksmana (2018), "The Impact of Corporate Social Responsibility on Rsk Taking and Firm Value", Journal of Business Ethics, 151(2), 353-373. https://doi.org/10.1007/s10551-016-3202-y
  16. Hu, Y., S. Chen and J. Wang (2018), "Managerial Humanistic Attention and CSR: Do Firm Characteristics Matter?", Sustainability, 10(11), 4029. https://doi.org/10.3390/su10114029
  17. Hu, Y., Q. Zhang and X. Wang (2019), "Potentials of Top management Team Career Development and Corporate Social Responsibility", Career Development International, 24(6), 560-579. https://doi.org/10.1108/CDI-04-2018-0114
  18. Huang, X. 'Beryl' and L. Watson (2015), "Corporate Social Responsibility Research in Accounting", Journal of Accounting Literature, 34, 1-16. https://doi.org/10.1016/j.acclit.2015.03.001
  19. Iraman, E. and S. Ryu (2013), "The Effect of Institutional, Demographic, and Organizational Inertia on Tax Compliance: Evidence from Dkijakarta Province", Universitas Gadjah Mada Working Paper.
  20. Kini, O. and R. Williams (2012), "Tournament Incentives, Firm Risk, and Corporate Policies", Journal of Financial Economics, 103(2), 350-376. https://doi.org/10.1016/j.jfineco.2011.09.005
  21. Lee, K. H., B. C. Cin and E. Y. Lee (2016), "Environmental Responsibility and Firm Performance: the Application of an Environmental, Social and Governance Model", Business Strategy and the Environment, 25(1), 40-53. https://doi.org/10.1002/bse.1855
  22. McGuinness, P. B., J. P. Vieito and M. Wang (2017), "The Role of Board Gender and Foreign Ownership in the CSR Performance of Chinese Listed Firms", Journal of Corporate Finance, 42, 75-99. https://doi.org/10.1016/j.jcorpfin.2016.11.001
  23. O'Sullivan, D. and J. McCallig (2012), "Customer Satisfaction, Earnings and Firm Value", European Journal of Marketing, 46(6), 827-843. https://doi.org/10.1108/03090561211214627
  24. Park, K. (2017), "Pay Disparities within Top Management Teams and Earning Management", Journal of Accounting and Public Policy, 36(1), 59-81. https://doi.org/10.1016/j.jaccpubpol.2016.11.002
  25. Parrotta, P., D. Pozzoli and M. Pytlikova (2014), "Labor Diversity and Firm Productivity", European Economic Review, 66, 144-179. https://doi.org/10.1016/j.euroecorev.2013.12.002
  26. Raza, A., M. I. Ilyas, R. Rauf and R. Qamar (2012), "Relationship between Corporate Social Responsibility (CSR) and Corporate Financial Performance (CFP): Literature Review Approach", Elixir Financial Management, 46, 8404-8409.
  27. Reuber, A. R. and E. Fischer (1997), "The Influence of the Management Team's International Experience on the Internationalization Behaviors of SMEs", Journal of International Business Studies, 28(4), 807-825. https://doi.org/10.1057/palgrave.jibs.8490120
  28. Servaes, H. and A. Tamayo (2013), "The Impact of Corporate Social Responsibility on Firm Value: The Role of Customer Awareness", Management Science, 59(5), 1045-1061. https://doi.org/10.1287/mnsc.1120.1630
  29. Sitkin, S. B. and A. L. Pablo (1992), "Reconceptualizing the Determinants of Risk Behavior", Academy of Management Review, 17(1), 9-38. https://doi.org/10.2307/258646
  30. Thomas, D. E, M. M. Arthur and J. N. Hood (2012), "Internationalization, TMT Gender Diversity and Firm Performance in Mexican Firms", International Journal of Strategic Management, 12(2), 243-363.
  31. Tihanyi, L., A. E. Ellstrand, C. M. Daily and D. R. Dalton (2000), "Composition of the Top Management Team and Firm International Diversification", Journal of Management, 26(6), 1157-1177. https://doi.org/10.1177/014920630002600605
  32. Velinov, E. and A. Kubicek (2013), "The Role of Top Management Teams Heterogeneity in the IPO Process." European Conference on Management, Leadership & Governance. Academic Conferences International Limited.
  33. Wen, W. and J. Song (2017), "Can Returnee Managers Promote CSR Performance? Evidence from China", Frontiers of Business Research in China, 11(1), 12. https://doi.org/10.1186/s11782-017-0012-8
  34. White, H. (1980), "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity", Econometrica: Journal of the Econometric Society, 48(4), 817-838. https://doi.org/10.2307/1912934
  35. Wiersema, M. F. and K. A. Bantel (1992), "Top Management Team Demography and Corporate Strategic Change", Academy of Management Journal, 35(1), 91-121. https://doi.org/10.2307/256474
  36. Wright, P. and S. P. Ferris (1997), "Agency Conflict and Corporate Strategy: The Effect of Divestment on Corporate Value", Strategic Management Journal, 18(1), 77-83. https://doi.org/10.1002/(SICI)1097-0266(199701)18:1<77::AID-SMJ810>3.0.CO;2-R
  37. Yasser, Q. R., A. A. Mamun, S. Zaman, M. J. Ali and G. Bhavani (2020), "Corporate Social Responsibility and Age of Productivity: A Study on Emerging Economies", Thunderbird International Business Review, 62(6), 661-674. https://doi.org/10.1002/tie.22172
  38. Zelechowski, D. D. and D. Bilimoria (2004), "Characteristics of Women and Men Corporate Inside Directors in the US", Corporate Governance: an International Review, 12(3), 337-342. https://doi.org/10.1111/j.1467-8683.2004.00374.x