The influence of board social capital on corporate social responsibility reporting

PurposeThe main objective of this paper is to analyze the influence of multiple directorships, as a critical component of board social capital, on CSR reporting. This study also explores the moderating effect of certain board attributes on multiple directorships.Design/methodology/approachThe authors’ sample is composed of Spanish listed firms in the Madrid Stock Exchange for the period 2011–2017. A dynamic panel data model based on the Generalized Method of Moments (GMMs) is employed.FindingsRelying on a resource dependence view, the authors’ results highlight an ambiguously positive association between multiple directorships and the level of CSR reporting. In particular, this relationship is positively moderated by both board size and gender diversity.Research limitations/implicationsThese findings contribute to academic debates concerning the value of board members intellectual capital. In particular, the authors emphasize the importance of board social capital, as well as the need to consider the context in which directors make decisions.Practical implicationsThis evidence may prove helpful to firms when configuring the board of directors, and for regulators and professionals when refining their legislations and recommendations.Originality/valueTo the best of the authors' knowledge, this is the first study that empirically analyzes the impact of an important element of board social capital, such as multiple directorships, on CSR reporting, which has become crucial in financial markets.

Board social capital reduces implied cost of capital for private companies but not of state-owned companies

Purpose The purpose of this paper is to analyze how the type of ownership and control moderates the effect of the board social capital on the implied cost of capital. To do so, the authors analyzed the effect of the board social capital by the relational resources present in its direct and heterogenous ties, considering the predictions of analysts about the implied cost of capital. Design/methodology/approach The data panel comprised 137 companies listed on the Brazilian stock exchange between the years of 2002 and 2015, generating a total of 535 observations. The authors check the robustness of the results through instrumental variables and systems of equations, as well as compete for the effect of board social capital both by the board and ownership structures. Findings Results show that the board relational resources, both in direct and heterogeneous ties, significantly reduce the implied cost of capital for private companies, but not for state-owned companies. Board social capital reduces the cost of capital even when the results compete with the board structure and concentration of ownership, being able to mitigate the discount in the cost of capital by the presence of dominant shareholders. Originality/value This study uses a more theoretically and empirically comprehensive measure of board social capital than the majority of studies that use only network position indicators. So, contrasting the effect of this measure on the implied cost of capital between private and state-owned companies, the authors also demonstrate that the board social capital can mitigate the discount by ownership concentration on the implied cost of capital.

Does Board Supervisory Quality Enhance Corporate Social Performance?-Evidence from Taiwanese Listed Firms

This study uses Taiwanese public firms as a sample to examine if board supervisory quality enhances CSP. The present study uses four proxies for supervisory quality of board at group level: board meeting attendance rate, number of board meetings, social capital of the board and average training hours of directors. We obtain 348 CSR data from an international CSR rating agent and match them with double size non-CSR firms. We find that CSR firms exhibit significantly higher board attendance rate, board meeting frequency and board social capital than non-CSR firms. For CSR firms, board attendance rate and board meeting frequency positively impact CSR ratings, implying that board diligence is essential to monitoring management to achieve higher social objectives. However, board social capital and training significantly but negatively impact CSP, implying busy board and inexperienced board detriments CSP.Board success in CSR means directors must be passionate about the issues on CSR. Additionally, firms that are behind social agenda need to recruit resourceful directors to diversify information base for advises about stakeholder issues and trends. Firms that have taken steps in CSR activities should not recruit overly busy directors or inexperienced directors. Our paper provides both theoretical and practical implications.