Geographical Diversity Among Directors and Corporate Social Responsibility

Abstract

Previous research documents the importance of board of directors’ characteristics in affecting corporate social responsibility (CSR) performance. We extend this literature by focusing on one attribute of the members of the board of directors, their place of residence and its impact on CSR performance (CSRP), which has not been previously investigated. This dimension is important since there is an increasing trend in nominating directors who live far from corporate headquarters. We rely on stakeholder theory and image motivation to explain this relationship. Using a sample of Canadian firms from 2009 to 2017, we find that geographical diversity among the board of directors has a positive impact on some dimensions of CSR. In addition, our results show that the improvement in CSRP is not value destructive. Our results extend the literature on demographic characteristics of directors and its impact on directors’ decision‐making about CSR.

Firm Performance and Corporate Social Responsibility: Spatial Context and Effect Mechanism

“…Therefore, this study’s results support the spatial context-sensitive thesis, in line with previous studies that emphasized the importance of geographic proximity (B.-JChang & Han, 2015; K. Chang et al, 2021; Firoozi & Keddie, 2022; Zamir & Saeed, 2020). However, in contrast to the previous view of the spatial context-sensitive thesis, this study adds a time lag factor and shows that the spatial and time lag effects are interchangeable.…”

“…However, an increasing number of studies have discovered the effect of the spatial context on CSR and concluded that a company’s CSR is highly dependent on the CSR of other firms in the same region (K. Chang et al, 2021; Firoozi & Keddie, 2022; Zamir & Saeed, 2020). Park et al (2017) found that the spatial context affected the relationship between risk and CSR significantly.…”

Drivers of Global Banking Stability in Times of Crisis: The Role of Corporate Social Responsibility

“…The use of the Refinitiv ESG Rating database is increasingly popular in CSR research (see Albuquerque et al ., 2020; Bae et al ., 2021; Demers et al ., 2021; Firoozi and Keddie, 2021; Lins, Servaes and Tamayo, 2017). Refinitiv ESG Stat offers a detailed assessment of 10 categories of firm performance with regard to ESG aspects, including resource use, emissions and innovation, workplace, human rights, community and product responsibility, management, shareholders and CSR strategies.…”

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

“…Research dependence theory has similarities to stakeholder theory in recognizing the interrelationships between external and internal parties of the company (Hillman, Withers, & Collins, 2009) and has a relationship with upper echelon theory regarding decision-making that will be taken by the resources owned by the company, namely the board (Firoozi & Keddie, 2021). This theory is very relevant to the diverse context of the board (Issa & Fang, 2019) and the theory that can understand the board of the company (Hillman et al, 2009).…”