Abstract
CG and CSR can be described as two sides of the same coin. Better governance leads the corporates to behave responsibly for the wellbeing of all the stakeholders. CSR is the medium through which corporates address the large group of stakeholders. Corporate Social Responsibility (CSR) moving far ahead from its age old domain of philanthropy and charity has now reached to a new hallmark of Corporate responsiveness and action to social issues and demand for sustainability in order to advance further towards a new era of collective future action for factoring the sustainable business strategy for good governance and development of the society and its people. The recent changing in the laws in India related to CSR and CG practices in India triggers this study to determine the relationship between them and also measure the influence of governance attributes on CSR practices of Indian corporates. The BSE SENSEX companies in India are the leaders in good governance practices and also the flag bearers in carrying out major CSR activities even when the CSR was not mandatory in India. The influence of corporate board attributes like Board Size, Board independent, Chairman-CEO duality, Female representative in corporate board, multiple directorships, and Promoter and directors shareholding on Corporate Social Responsibility measured through multiple regression analysis. The results revealed that chairman-CEO duality and the present of female directors in corporate board significantly influence of CSR contribution. Before generalization of the result of study further research could be undertaken taking a large group of Indian companies and wider corporate governance variables.
Highlights
Corporate Social Responsibility: Corporate social responsibility is not a new concept in India
Having the research objective to measure the influence of corporate governance on Corporate Social Responsibility (CSR) policies and practices multiple regression analysis performed on the derived data using the CSR as dependent variable and BSIZE, Independence of the Board (INDPB), Chairman-CEO Duality (CCDUAL), MDRP, Female board representative (FBRP) and Promoter & Director Shareholding (PDSH) independent variables to see the combined effect of these corporate board attributes as representative of corporate governance drivers
The study was proposed with an objective to study the interrelationship between CG and CSR and the influence corporate governance on CSR disclosure practices in Indian Context
Summary
Corporate Social Responsibility: Corporate social responsibility is not a new concept in India. The recent overhaul in the corporate governance norms for all companies under the new companies Act, 2013 enacted on August 30, 2013 and the consequent amendment by Securities and exchange Board of India to Clauses 35B and 49 of the Equity Listing agreement dated April 17, 2014 triggers this study to determine the interrelationship of corporate governance on corporate social responsibilities practices of Indian companies. Sir Adrian Cadbury, 2002 remarked that: ‘The broadest way of defining social responsibility is to say that the continued existence of companies is based on an implied agreement between business and society’ and that ‘the essence of the contract between society and business is that companies shall not pursue their immediate profit objectives at the expense of the longer-term interests of the community’ The wider stakeholder community is making increasing demands that board of governance be held accountable for the social and environmental impacts of their operations.
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