Does Board Diversity Matter for the Quality of CSR Disclosure? Evidence from the Financial Sector of Pakistan

Abstract

Purpose -This study aims to examine the influence of board diversity on the quality of CSR disclosure (QCSR) and propose that this relationship is patterned differently in different contexts and nations, due to their distinctive characteristics.Design/methodology/approach -The resource-based view (RBV) theory is used to evaluate the hypothesized relationship through an empirical investigation of 64 Pakistani financial firms, by applying a random-effects regression and the generalized method of moments (GMM).] Findings -The findings indicate that age, gender, educational level, and educational background diversities positively influence QCSR disclosure. However, nationality, ethnic, and tenure diversities have no significant relationship with QCSR disclosure. The results were further checked by a robust regression and sensitivity analysis.Originality/value -Using RBV theory, this paper provides an additional contribution concerning the role played by board diversity in a firm's strategic performance, particularly CSR disclosure. The article contributes to the literature by finding that there is no unanimous rule for board diversity supporting CSR, due to the unique characteristics of different jurisdictions and institutional contexts.

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“…There is no evidence that higher education increases awareness of the environment. This result is totally different from the previous findings (Beji et al, 2021;Harjoto et al, 2019;Katmon et al, 2019;Khan et al, 2021). Mirroring the result of NRE, which positively influences NRE consumption by 0.113 at p<0.01, directors who hold higher education behave unethically and pay less attention to CSR and environmental damage, further exacerbating and marginalizing educational contributions.…”

Theories applied in corporate voluntary disclosure: a literature review

“…Voluntary disclosure as a strategic tool in achieving organizational goals and manipulating their stakeholders' attitude to a desirable level (Agyei and Yankey, 2019) Resource dependence theory (Pfeffer and Salancik, 1978) Resource dependence theory is concerned with how the external resources of organizations affect the behavior of the organization Organizations typically build joblessness into resource acquisition in order to reduce their reliance on single sources (Khan et al, 2021) Table 1. compensation is linked to stock price (Singh and Chakraborty, 2021;Sekhon and Kathuria, 2020;Biswas et al, 2019); and…”

“…These contextualized features are frequently associated with different kinds of corporation features in different states and capital markets. Several theories have been applied in the literature to significantly disclose voluntary information in the organizations such as agency theory (Pakawaru et al, 2021;Nguyen et al, 2021;Zaid et al, 2020;Biswas et al, 2019;Katmon et al, 2019;El-Diftar et al, 2017), signaling theory (Leung and Snell, 2021;Charumathi and Ramesh, 2020), resource dependence theory (Khan et al, 2021), impression management theory (Morales-Raya et al, 2019), stakeholder theory (Singh and Chakraborty, 2021;Charumathi and Ramesh, 2020;Rashid et al, 2020;Buallay et al, 2020;Waheed and Yang, 2019;Dias et al, 2019;Hu et al, 2018), political economy theory (Agyei and Yankey, 2019), legitimacy theory (Acar and Temiz, 2020;Hickman, 2020;Pitrakkos and Maroun, 2020;Rosa Portella and Borba, 2020;Al Fadli et al, 2019;Ullah et al, 2019;Garas and EIMassah, 2018;Sobhan et al, 2018;William et al, 2018), institutional theory (Akbar and Deegan, 2021;Bellamy et al, 2020;Oliveira et al, 2019;Russo-Spena et al, 2018) and neo-institutional theory (Kilincarslan et al, 2020;Alshbili and Elamer, 2020;Sekhon and Kathuria, 2020;Shahab and Ye, 2018).This variation findings of the earlier literature demands that need for an inclusive review of the theories in CVD works.…”

Impact of Nationality and Educational Diversity on CSR Performance: The Moderating Role of CEO Overconfidence

“…Research conducted in several developing countries (Azam, Khalid, & Zia, 2019;Colakoglu, Eryilmaz, & Martínez-Ferrero, 2021;Khan, Khan, & Afridi, 2021) has different results from research conducted in developed countries. The difference is that the role of a diverse board cannot improve sustainability performance within the company.…”