Banks’ CSR reporting – Do women have a say?

• DOI: https://doi.org/10.1108/CG-11-2019-0338
• Pages: 639-651
• Date: 23 April 2020
• Published date: 23 April 2020
• Author: Triinu Tapver,Laivi Laidroo,Natalie Aleksandra Gurvitš-Suits
• Subject Matter: Corporate governance,Strategy

Banks’CSR reporting –Do women have

asay?

Triinu Tapver, Laivi Laidroo and Natalie Aleksandra Gurvitš-Suits

Abstract

Purpose –This paper aims to determine the associationbetween corporate social responsibility (CSR)

reporting of listed banksand female representation on boards while controlling for the impactof gender

quotas.

Design/methodology/approach –Logistic regressions are used with bank fixed effects on a global

sampleof 285 commercial banks from 2005 to 2017.

Findings –There exists a positive association between the proportion of women on board and banks’

CSR disclosure. Positiveassociation remains also after quota corrections for bankswith either below- or

above-quotafemale representation. Further,adding more women to boards than requiredby quota could

affect boards’CSR reporting in masculine countriesbut not in feminine countries.

Research limitations/implications –The results are not generalizable to smaller listed banks andthe

used estimationapproach does not enable to detect causality.

Practical implications –Policymakers interested in improving banks’ CSR reporting could introduce

genderquotas.

Social implications –Gender quotascan enforce banks’ sustainable behaviour.

Originality/value –First, it is the firststudy to thoroughly control for gender quotas whileinvestigating the

association between female representation on boards and CSR disclosure. Second, this papermoves

forward from the so-far predominant concentration on single-country studies on banks’ CSR reporting.

Third, this paper covers theaspect of a country’s masculinity-femininity asa factor that could influence

the associationbetween CSR disclosure and female representation.

Keywords CSR reporting, Board composition, Gender diversity, Gender quotas

Paper type Research paper

1. Introduction

The role of women on boards is a contemporary ethical issue for most companies (Terjesen

and Sealy, 2016). Previous studies have shown that the presence of women on boards

improves the board’s internal regularity, favours board strategic control and mitigates

conflicts (Benkraiem et al., 2017;Huse and Solberg, 2006;Nielsen and Huse, 2010). It is

also often associated with improved corporate social responsibility (CSR) disclosure and

CSR performance of companies (Harjoto and Rossi, 2019;Khan et al.,2019;Kilic et al.,

2015;Kyaw et al.,2017). In light of these benefits, several countries such as Norway,

Finland, Iceland and Belgium have introduced gender quotas starting from 2003

(Section 2). However, recent empirical evidence indicates that the introduction of

quotas has not always led to the desired outcome (Ahern and Dittmar, 2012;Matsa and

Miller, 2013;Terjesen and Sealy, 2016). This can be related to the legitimacy and

credibility issues surrounding the appointment of new female board members for meeting

the quota, as well as tokenism (Fitzsimmons, 2012;Terjesenet al., 2015). Surprisingly,

previous research has tended to overlook the impact of gender quotas on the association

between female representation on boards and corporate CSR outcomes (Barako and

Brown, 2008;Hossain and Reaz, 2007;Jizi et al., 2014;Khan, 2010). Understanding the

Triinu Tapver, Laivi Laidroo

and Natalie Aleksandra

Gurvits

ˇ-Suits are all based

at the TalTech School of

Business and Governance,

Tallinn University of

Technology, Tallinn,

Estonia.

JEL classif‌ication –G21, G34,

M4, M14

Received 5 November 2019

Revised 21 January 2020

26 March 2020

Accepted 29 March 2020

We appreciate the insightful

comments received from the

members of the finance

research group at TalTech

School of Business and

Governance. Special thanks go

to Pavlo Illiashenko and

Karsten Staehr for their

constructive feedback.

Funding: This work was

supported by Tallinn University

of Technology under Grant B57

“Efficiency in Financial Sector

in Light of Changing Regulatory

Environment” and by the

Doctoral School in Economics

and Innovation, supported by

the European Union, European

Regional Development Fund

(Tallinn University of

Technology ASTRA project

“TTU

¨Development Program

2016-2022”, project code:

2014-2020.4.01.16-0032). This

paper represents the work

conducted in connection with

these grants. The funding

providers had no role in the

research process from study

design to submission.

DOI 10.1108/CG-11-2019-0338 VOL. 20 NO. 4 2020, pp. 639-651, ©Emerald Publishing Limited, ISSN 1472-0701 jCORPORATE GOVERNANCE jPAGE 639