Participants after the dissemination
Appointing six female directors out of 10 has proven to increase the Corporate Social Responsibility (CSR) of organisations, a new study has revealed.
According to the study which investigated whether women in leadership affect firms’ environmental, social and governance performance in the Greater Accra Region of Ghana using linear regression and quasi-experimental approaches, appointing more than six women as directors out of ten directors within a firm could adversely affect CSR gains.
A study conducted by researchers from the School of Economics, University of Cape Coast, (UCC) in partnership with the Ghana Statistical Service and the University of Western Ontario has revealed that gender diversity at firm leadership has a positive association with CSR outcomes.
These findings make a clarion call for gender diversity in the decision-making body of firms but caution against female dominance.
“Of the four components of CSR, gender-diverse firms have the biggest effect in increasing ethical responsibility, followed by discretionary, economic, and legal responsibilities.
This finding converges with existing studies that demonstrate that women in firm leadership will care more about ethical and broader societal issues compared to their male counterparts,” said Dr. Raymond E. Kofinti, Project Lead, UCC, at a research dissemination event in Accra.
He indicated that firm’s jointly owned by Ghanaians and foreigners have better CSR outcomes than exclusively owned firms by foreigners or Ghanaians.
“Maturing firms (5-14 years) were found to be more adherent to CSR outcomes compared to young (0-4 years) and established (>15 years) firms. The key statistics on gender diversity revealed that three out of every ten directors (30.5%) are women, and more than two out of five firms (47.6%) have at least a third of their directors being women. Firms in food and accommodation-related issues were much more gender diverse than other sectors,” he added.
Dr. Gloria Essilfie, research team member, said gender gaps in values were observed at the director level, with female directors ranking low in power value compared to male directors.
“This suggests that firms with more representation of female directors are more likely to advocate CSR decisions because female directors emphasize self-transcendence values and motives compared to their male counterparts,” she said.
The sampling and data collection were undertaken by the Ghana Statistical Service focusing on 312 medium and large firms and, values data on 792 respective directors of these firms comprising 292 female and 500 male directors.
The project is a research initiative by Private Enterprise Development in Low-Income Countries (PEDL), a programme funded jointly by the Centre for Economic Policy Research (CEPR) and the Foreign, Commonwealth and Development Office (FCDO).
By Jamila Akweley Okertchiri