This study aims to examine the impact of independent directors' ownership on corporate social responsibility (CSR) performance. In line with the stakeholder-agency paradigm's prediction, the authors propose that higher independent directors' ownership is associated with higher CSR performance. By drawing on the attention-based view, the authors further examine firm-level conditions that impact the situated attention of independent directors holding high equity ownership as they are active agents.
The authors collected data covering the years 2009–2013 for firms listed in the S&P 500 index. The authors tested the hypotheses using firm fixed-effects models.
The results show that higher independent directors' ownership is associated with higher CSR performance. Prior firm performance and available slack resources are found to have diverse impacts on the association between independent directors holding high equity ownership and CSR performance.
This study highlights the importance of examining the performance-based incentives of independent directors on firms' CSR performance. This study also provides a better understanding of factors impacting independent directors' situated attention as boundary conditions.
