DIRECTOR OWNERSHIP, OUTSIDE DIRECTORS AND COMMITMENT TO CORPORATE SOCIAL RESPONSIBILITY

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Abstract

This paper examines the effects of director ownership and the proportion of outside directors on firms’ commitment to corporate social responsibility (CSR). Using a sample of 453 Hong Kong listed companies for 2005, we find that there is a non-linear relationship between the level of director ownership and firms’ engagement in CSR behavior. Commitment to CSR first increases as the proportion of director ownership increases up to 50% and then decreases as that proportion of ownership grows higher. Further, the proportion of outside directors on the board exhibits a positive relationship with the level of CSR commitment. These results provide explanations for firms’ commitment to CSR from the corporate governance perspective.

Keywords: Corporate Social Responsibility, Director Ownership, Board of Directors, Outside Directors

How to cite this paper: Ying, C., & Leung, S. (2011). Director ownership, outside directors and commitment to corporate social responsibility. Corporate Board: role, duties and composition, 7(1), 66-78. https://doi.org/10.22495/cbv7i1art6