The Impact of Board Gender Diversity and Foreign Institutional Investors on the Corporate Social Responsibility (CSR) Engagement of Chinese Listed Companies

Abstract

The main purpose of this research is to examine the impact of board gender diversity and foreign institutional investors on the corporate social responsibility engagement of Chinese listed companies by considering a sample from the China Stock Market and Accounting Research (CSMAR) database of all non-financial firms listed on the Shanghai stock exchange and the Shenzhen stock exchange during the period from 2008–2015. The CSR is engaged by using the data from the CSMAR database at the firm level, and ranks the CSR disclosures of Chinese companies separately. The recent CSR promotion in China produced a visible increase in attracting female members on the board and members as foreign institutional investors by Chinese listed companies. The findings also showed that the greater the presence of female directors on the board, the stronger the CSR engagement would be. According to critical mass theory and team dynamics, these findings further broaden the accounts that emphasize social networks based on gender. Hence, female members on the board of directors emerged to be significant as a gender mix with extending CSR change. Therefore, our results added a new aspect to the emerging literature on CSR-engagement and gender especially in China. Due to intense political forces and networks in the Chinese listed entities, foreign institutional investors (FIIS) have less incentive to enhance CSR engagement further. Thus, the impact of foreign institutional investors on CSR engagement is as yet unknown, but we improved our knowledge about how the international aspects affect CSR in China. Furthermore, our results are robust, which concern control variables under consideration.