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

In: Corporate Governance and Corporate Social Responsibility of Indian Companies

Author

Listed:
  • Saumitra N. Bhaduri

    (Madras School of Economics)

  • Ekta Selarka

    (Madras School of Economics)

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.

Suggested Citation

  • Saumitra N. Bhaduri & Ekta Selarka, 2016. "Impact of Corporate Governance on Corporate Social Responsibility: An Empirical Exploration Using Structural Equation Technique," CSR, Sustainability, Ethics & Governance, in: Corporate Governance and Corporate Social Responsibility of Indian Companies, chapter 0, pages 115-125, Springer.
  • Handle: RePEc:spr:csrchp:978-981-10-0925-9_8
    DOI: 10.1007/978-981-10-0925-9_8
    as

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