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Exploring the Relationship Between Board Characteristics and CSR: Empirical Evidence from Korea

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Abstract

Previous studies in Western contexts have examined the relationships between various board characteristics and CSR, yet the relationships need to be re-examined in non-Western contexts given differential theoretical premises across contexts. We specifically propose that the effects of board characteristics on CSR in Korea should be patterned distinctively from Western-based existing literature, focusing on three important board characteristics, such as a board’s independence, social ties, and diversity. Using a panel dataset from large Korean firms, we found that various relationships between board characteristics and CSR were non-linear, whereas most of the previous research on Western contexts found that the same relationships were linear. Specifically, curvilinear relationships were found between CSR and board independence (i.e., exponentially growing shape), CEO-outside director social ties (i.e., inverted U-shape), and educational diversity (i.e., U-shape). Our findings suggest that there is no universal feature of CSR-supportive board characteristics due to the unique characteristics of various institutional contexts.

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Notes

  1. Because there is a ‘corporate governance’ domain in KEJI, we also used adjusted CSR ratings by excluding scores directly related to boards of directors. The results are similar to the reported ones.

  2. For the sake of robustness, we also conducted a GLS random-effects model, and the results are similar to the reported ones: squared terms of board independence (β = 0.86, p ≤ 0.05), CEO-outside director social ties (β = −2.73, p ≤ 0.05), and educational diversity (β = 2.91, p ≤ 0.05).

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Authors and Affiliations

  1. Sogang Business School, Sogang University, 35 Baekbeom-ro, Mapo-gu, Seoul, 121-742, South Korea

    Young Kyun Chang, Jee Hyun Park & Myoung Gyun Jang

  2. Haskayne School of Business, University of Calgary, 2500 University Drive NW, Calgary, AB, T2N 1N4, Canada

    Won-Yong Oh

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  1. Young Kyun Chang
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  4. Myoung Gyun Jang
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Correspondence to Young Kyun Chang.

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Chang, Y.K., Oh, WY., Park, J.H. et al. Exploring the Relationship Between Board Characteristics and CSR: Empirical Evidence from Korea. J Bus Ethics 140, 225–242 (2017). https://doi.org/10.1007/s10551-015-2651-z

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