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Impact of Corporate Governance on Corporate Social Responsibility: An Empirical Exploration Using Structural Equation Technique

Chapter
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Part of the CSR, Sustainability, Ethics & Governance book series (CSEG)

Abstract

This chapter presents the structural equation model that address two critical issues related to the unobservability of the attributes derived from various theoretical constructs and potential measurement errors. Further the proposed model also incorporates the possibility of cross-correlations across the unobservable factors. The results show that all the four specified attributes – Structure, Financial Constraint, Corporate Governance and Duality – significantly influence the CSR spending of large Indian firms. More specifically, we find evidence that poor corporate governance coupled with insider control over the board tend to explain the variation in CSR activities across firms. The other conventional factors such as age, size and financial viability of a firm also contribute to the CSR spending by these firms.

Keywords

Corporate Social Responsibility Corporate Governance Structural Equation Model Financial Constraint Excess Return 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Science+Business Media Singapore 2016

Authors and Affiliations

  1. 1.Madras School of EconomicsChennaiIndia

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