The influence of board characteristics and state holding on corporate social responsibility disclosure, evidence from Vietnamese listed firms
Abstract
Analysing the nexus between board diversity, CEO power, state holding, and corporate social responsibility disclosure in an emerging country: Vietnam, where some listed firms are held significantly by the State, is the fundamental objective of this study. In order to achieve this goal, we employed regression analysis using panel data. While board diversity consists of board gender diversification and board independence and CEO (executive) power, consisting of executive duality, executive holding (ownership), and deputy CEO, and state ownership are explanatory variables, and CSR disclosure is a dependent variable. The sample contains of 166 Vietnamese listed firms at the Hanoi Stock Exchange (HNX) for 2014−2016. After performing regression analysis, the result revealed that the proportion of female directors, deputy CEO, and state holding had a significant correlation with CSR publication. In contrast, the proportion of independent directors, CEO duality, and CEO ownership was found to be insignificant. Our research adds to the research on firm governance and CSR in several approaches. First, the paper adds to the study on the advancement of research toward corporate social responsibility and firm governance and CEO features impress on it. Second, our research expands CSR literature in developing countries, which has not been treated in detail. Fourth, this research advances and adds literature to some theories, including agency theory and resource-based view theory.
Keyword : board diversity, CEO power, CSR disclosure, state ownership, Vietnamese listed firms, agency theory, resource-based view theory
How to Cite
Nguyen, T. L. H., Tran, N. M., & Vu, M. C. (2021). The influence of board characteristics and state holding on corporate social responsibility disclosure, evidence from Vietnamese listed firms. Business: Theory and Practice, 22(1), 190-201. https://doi.org/10.3846/btp.2021.13490
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Zhang, J. Q., Zhu, H., & Ding, H. bin. (2013). Board composition and corporate social responsibility: an empirical investigation in the Post Sarbanes-Oxley Era. Journal of Business Ethics, 114(3), 381–392. https://doi.org/10.1007/s10551-012-1352-0
Bai, C. E. N., Lu, J., & Tao, Z. (2006). The multitask theory of state enterprise reform: Empirical evidence from China. American Economic Review, 96(2), 353–357. https://doi.org/10.1257/000282806777212125
Barros, C. P., Boubaker, S., & Hamrouni, A. (2013). Corporate governance and voluntary disclosure in France. Journal of Applied Business Research, 29(2), 561–578. https://doi.org/10.19030/jabr.v29i2.7657
Ben-Amar, W., Chang, M., & McIlkenny, P. (2017). Board gender diversity and corporate response to sustainability initiatives: evidence from the Carbon Disclosure Project. Journal of Business Ethics, 142(2), 369–383. https://doi.org/10.1007/s10551-015-2759-1
Dang A., R., Houanti, L., Le, N. T., & Vu, M. C. (2018). Does corporate governance influence firm performance? Quantile regression evidence from a transactional economy. Applied Economics Letters, 25(14), 984–988. https://doi.org/10.1080/13504851.2017.1390309
del Mar Alonso-Almeida, M., Perramon, J., & Bagur, L. (2015). Women managers and corporate social responsibility (CSR) in Spain: Perceptions and drivers. Women’s Studies International Forum, 50, 47–56. https://doi.org/10.1016/j.wsif.2015.02.007
Fama, E. F., & Jensen, M. C. (1983). Agency problems and residual claims. The Journal of Law and Economics, 26(2), 327–349. https://doi.org/10.1086/467038
Ferrero-Ferrero, I., Fernandez-Izquierdo, M. A., & Munoz-Torres, M. J. (2015). Integrating sustainability into corporate governance: an empirical study on board diversity. Corporate Social Responsibility and Environmental Management, 22(4), 193–207. https://doi.org/10.1002/csr.1333
Field, A. (2005). Discovering statistics using SPSS (2nd ed.). SAGE Publications.
Garcia-Torea, N., Fernandez-Feijoo, B., & de la Cuesta-Gonzalez, M. (2017). La influencia de la estructura de propiedad en la transparencia de la informacion de RSC: evidencia del caso Espanol. Revista Espanola de Financiacion y Contabilidad, 46(3), 249–271. https://doi.org/10.1080/02102412.2016.1267451
Ghazali, N. A. M. (2007). Ownership structure and corporate social responsibility disclosure: Some Malaysian evidence. Corporate Governance, 7(3), 251–266. https://doi.org/10.1108/14720700710756535
Herda, D. N., Taylor, M. E., & Winterbotham, G. (2014). The effect of country-level investor protection on the voluntary assurance of sustainability reports. Journal of International Financial Management and Accounting, 25(2), 209–236. https://doi.org/10.1111/jifm.12018
Hoang, T. C., Abeysekera, I., & Ma, S. (2018). Board diversity and corporate social disclosure: evidence from Vietnam. Journal of Business Ethics, 151(3), 833–852. https://doi.org/10.1007/s10551-016-3260-1
Hudson, S., & Miller, G. (2005). Ethical orientation and awareness of tourism students. Journal of Business Ethics, 62(4), 383–396. https://doi.org/10.1007/s10551-005-0850-8
Ibrahim, N. A., & Angelidis, J. P. (1995). The corporate social responsiveness orientation of board members: Are there differences between inside and outside directors? Journal of Business Ethics, 14(5), 405–410. https://doi.org/10.1007/BF00872102
Jensen, M. C., & Meckling, W. H. (1979). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 163–231. https://doi.org/10.1016/0304-405X(76)90026-X
Kabir, R., & Thai, H. M. (2017). Does corporate governance shape the relationship between corporate social responsibility and financial performance? Pacific Accounting Review, 29(2), 227–258. https://doi.org/10.1108/PAR-10-2016-0091
Katmon, N., Mohamad, Z. Z., Norwani, N. M., & Farooque, O. Al. (2019). Comprehensive board diversity and quality of corporate social responsibility disclosure: evidence from an emerging market. Journal of Business Ethics, 157(2), 447–481. https://doi.org/10.1007/s10551-017-3672-6
Kelly, K. (2011). Gender equality in education: looking beyond parity – Vietnam case study (preliminary findings): women in educational leadership and management. In International Institute for Education Planning: Evidence-based Policy Forum (pp. 3−4). Paris, France.
Khan, A., Muttakin, M. B., & Siddiqui, J. (2013). Corporate governance and corporate social responsibility disclosures: evidence from an emerging economy. Journal of Business Ethics, 114(2), 207–223. https://doi.org/10.1007/s10551-012-1336-0
Malik, F., Wang, F., Naseem, M. A., Ikram, A., & Ali, S. (2020). Determinants of corporate social responsibility related to CEO attributes: an empirical study. SAGE Open, 10(1). https://doi.org/10.1177/2158244019899093
Milliken, F. J., & Martins, L. L. (1996). Searching for common threads: Understanding the multiple effects of diversity in organizational groups. Academy of Management Review, 21(2), 402–433. https://doi.org/10.5465/amr.1996.9605060217
Mohamed Adnan, S., Hay, D., & van Staden, C. J. (2018). The influence of culture and corporate governance on corporate social responsibility disclosure: A cross country analysis. Journal of Cleaner Production, 198, 820–832. https://doi.org/10.1016/j.jclepro.2018.07.057
Muttakin, M. B., Khan, A., & Mihret, D. G. (2018). The effect of board capital and CEO power on corporate social responsibility disclosures. Journal of Business Ethics, 150(1), 41–56. https://doi.org/10.1007/s10551-016-3105-y
Naciti, V. (2019). Corporate governance and board of directors: The effect of a board composition on firm sustainability performance. Journal of Cleaner Production, 237, 117727. https://doi.org/10.1016/j.jclepro.2019.117727
Nguyen, D. T. (2018). Family involvement in ownership, control, management and firm performance: empirical evidence from Viet Nam. University of Newcastle.
Oh, W. Y., Li, Z., & Park, S. (2016). The effects of CEO characteristics and incentives on corporate social responsibility. Corporate Responsibility: Social Action, Institutions and Governance, 162–182. https://doi.org/10.1057/9781137450722_8
Sheikh, S. (2019). An examination of the dimensions of CEO power and corporate social responsibility. Review of Accounting and Finance, 18(2), 221–244. https://doi.org/10.1108/RAF-01-2018-0034
Tran, L. D. (2017). Some legal issues on information disclosure on the stock market. Industry and Trade.
Tran, N. M., & Pham, B. N. T. (2020). The influence of CEO characteristics on corporate environmental performance of SMEs: Evidence from Vietnamese SMEs. Management Science Letters, 10(8), 1671–1682. https://doi.org/10.5267/j.msl.2020.1.013
Van, L. T. H., & Nguyen, P. A. (2019). Corporate social responsibility and SMEs in Vietnam: A study in the textile and garment industry. Journal of Risk and Financial Management, 12(4), 174. https://doi.org/10.3390/jrfm12040174
Vu, K. A., Tower, G., & Scully, G. (2011). Corporate communication for Vietnamese listed firms. Asian Review of Accounting, 19(2). https://doi.org/10.1108/13217341111181069
Xu, B., & Zeng, T. (2016). Profitability, state ownership, tax reporting and corporate social responsibility: Evidence from Chinese listed firms. Social Responsibility Journal, 12(1), 23–31. https://doi.org/10.1108/SRJ-06-2014-0076
Zahra, S. A., & Pearce, J. A. (1989). Boards of directors and corporate financial performance: a review and integrative model. Journal of Management, 15(2). https://doi.org/10.1177/014920638901500208
Zhang, J. Q., Zhu, H., & Ding, H. bin. (2013). Board composition and corporate social responsibility: an empirical investigation in the Post Sarbanes-Oxley Era. Journal of Business Ethics, 114(3), 381–392. https://doi.org/10.1007/s10551-012-1352-0