An empirical study of the relationship between women director and corporate social responsibility performance: insights from China.

Abstract

Title: An empirical study of the relationship between women director and corporate social responsibility performance: insights from China. Background and Problem Discussion: Globally, women directors are increasingly recognized and valued for their governance and decision-making abilities, and their impact on CSR performance has become the focus of academic attention. However, the proportion of female directors in China remains below the global average and grows slowly. At the same time, there is a stark contrast between a range of serious social issues arising from China's fast-growing economy and the low level of CSR performance. Both the Chinese government and social organizations seek ways and measures to improve CSR performance effectively, and Chinese academics are beginning to study CSR from a corporate governance perspective. However, there are few studies on the relationship between women directors and CSR performance in Chinese listed companies. Therefore, against this background, a valuable research question to explore the impact of women directors' participation in corporate governance on CSR in China. Purpose: The study aims to examine the impact of women directors on CSR performance in Chinese listed companies and whether there is a positive relationship between the proportion of female directors and CSR performance. Methodology: This study uses ordinary least squares regression to test the effect of the proportion of female directors on the board of directors on corporate social responsibility performance. The study also reduces the effect of endogeneity through PSM and uses robustness tests to ensure the reliability of the results. The data for the test study are uniformly sourced from the CSRMAR database, and the scope of the study is A-share companies on the Shanghai and Shenzhen exchanges from 2015 to 2020. CSR performance uses Hexun ratings as an indicator. Findings: The results of OLS regression, PSM, and robustness tests indicate a significant correlation between the percentage of women directors and CSR performance, showing that the higher the proportion of women directors, the higher the organization's CSR performance. In addition, the study found no association between the presence or absence of women directors and CSR performance in China's listed corporations. 1 Originality: This study is unique in that it examines the relationship between board diversity and CSR performance using the most recent data available for listed companies in China. The study includes a six-year sample of 18,775 observations of the most recent listed companies in China. In addition, while similar Chinese studies commonly use lagged variables for one period to reduce the effect of endogeneity, our study uses nearest neighbor propensity score matching to reduce the effect of endogeneity issues, and also does lagged variables and a shortened sample time approach for robustness testing. Implication: Our results have significant implications for corporate governance and lawmakers. According to the findings of the study, a greater share of female directors is related with improved corporate social responsibility performance. In contrast, the current level of board gender diversity in China is still relatively low, and women are much less likely to be directors than men. The results provide new incentives for companies to promote the rights and interests of female employees, while prompting companies to designate clear policies to safeguard the avenues of advancement for female employees. Policymakers have also gained more evidence to push for legal reforms to clarify the proportion of women directors required in corporate governance. This all helps to drive CSR in Chinese companies.