Indian Journal of Science and Technology

Abstract

Objectives: To empirically analyze the moderating effect of corporate governance structure between CSR and the corporate performance. Methods/Statistical Analysis: To figure out if the corporate governance structure affects the corporate performance through CSR, this paper set the governance structure propriety factor as independent variable, the social responsibility as mediating variable, and the corporate performance as dependent variable. And Moderator regression analysis was conducted to verify the moderating effect of the governance structure between CSR and the corporate performance. Analysis was carried out in four steps regression. Findings: The result of empirical analysis is as follows: First, CSR has a positive effect on the performance; second, the governance structure has a moderating effect between CSR and the performance. In the process to implement CSR activity, agency costs would be incurred from a conflict between shareholders and the board. So considering that the effect CSR has on the performance is subject to the governance structure, sound governance structure may improve the corporate performance. This paper among other studies on CSR has significance in that it analyzed the moderating effect of corporate governance structure between CSR and the corporate performance for the first time. Above all, the inducements to implement CSR activities voluntarily and consistently were found. The significant result of this study is also practically meaningful and able to present a direction for policy making of the government on the corporate social responsibility. Improvements/Applications: The tasks to be done in the future include a relevant study consists of a considerable number of samples and time series data covering long period.

Keywords: CSR (Corporate Social Responsibility), Corporate Governance Structure, Moderating Effect, The Corporate Performance (Return on Assets)