This study examines the moderating role of corporate social responsibility (CSR) committees in the relationship between CSR practices and corporate tax avoidance. While CSR is often viewed as an ethical commitment, prior research suggests it may also be used symbolically to legitimize aggressive tax strategies (“tax greenwashing”). This study investigates whether CSR committees act as a substantive governance mechanism that constrains such opportunistic behavior in US NASDAQ-listed firms.
Using a panel of non-financial NASDAQ-listed firms from 2012 to 2023, the study employs a generalized least squares (GLS) estimator. This approach is specifically chosen to address heteroskedasticity and autocorrelation within the panel data, while accounting for unobserved firm-level heterogeneity, thereby ensuring the efficiency and statistical reliability of the empirical findings.
The results demonstrate that CSR committees significantly moderate the CSR–tax avoidance relationship. While CSR engagement alone shows an ambiguous association with tax behavior, the presence of a dedicated CSR committee is associated with lower levels of tax avoidance. This indicates that specialized governance oversight is essential to prevent the strategic decoupling of social responsibility from fiscal practice.
The findings highlight the importance of CSR committees for boards, investors, and policymakers as internal governance watchdogs that enhance fiscal accountability and mitigate reputational and regulatory risks related to tax aggressiveness.
This study contributes to the literature by identifying CSR committees as a key boundary condition shaping the ethical integrity of CSR strategies. Evidence from the US context suggests that internal governance structures, rather than CSR disclosure alone, are central to constraining the instrumental use of CSR for tax-related opportunism.
