Top Management Team Heterogeneity, Corporate Social Responsibility Disclosure and Financial Performance

Pinky Gupta

doi:10.4236/ajibm.2019.94074

Abstract

The purpose of this study is to examine the relationship between top management team (TMT) heterogeneity, corporate social responsibility disclosure (CSRD) and financial performance of banks listed in the Nepal Stock Exchange (NEPSE) by applying the conceptual framework of upper echelon theory. A sample of top 29 banks is studied from 2012 to 2017. The data is collected from their annual reports and websites. The results reveal that TMT heterogeneity and CSRD had a significant positive effect on the bank’s financial performance. CSRD plays a mediation role between TMT heterogeneity and financial performance. However, the effect of TMT gender heterogeneity on CSRD is insignificant. This study contributes to our understanding about how TMT heterogeneity affects financial performance through CSRD. This study also gives us new evidence to explore the link between TMT heterogeneity, CSRD and firm financial performance in emerging market.

Highlights

Corporate social responsibility has become a well-known issue concerned by scholars, entrepreneurs and government in Nepal
The purpose of this study is to examine the relationship between top management team (TMT) heterogeneity, corporate social responsibility disclosure (CSRD) and financial performance of banks listed in the Nepal Stock Exchange (NEPSE) by applying the conceptual framework of upper echelon theory
The results reveal that TMT heterogeneity and CSRD had a significant positive effect on the bank’s financial performance

Summary

Introduction

Corporate social responsibility has become a well-known issue concerned by scholars, entrepreneurs and government in Nepal. It is considered as one of the important research topics [1]. Corporate social responsibility disclosure (CSRD) is a process which provides information about interactions between organizations/firms with regard to environment, employees, society and customer issues [4]. It is a method of providing financial and non-financial information dealing with the society and environment context [5]. The research on CSRD in Nepal is of theoretical significance, and of great practical significance in guiding future development and policy impact

Objectives

Methods

Results