Does an increase of board compensation boost the corporate philanthropy: an empirical study

Autor: Marta Idasz-Balina, Rafał Balina, Noer Azam Achsani
Jazyk: angličtina
Rok vydání: 2024
Předmět:
Zdroj: Cogent Economics & Finance, Vol 12, Iss 1 (2024)
Druh dokumentu: article
ISSN: 23322039
2332-2039
DOI: 10.1080/23322039.2024.2416990
Popis: Our study examines the relationship between the management board compensation and corporate philanthropy in financial institutions. By analyzing a sample of 240 cooperative banks over six years, the research investigates the impact of management board compensation on the level and extent of corporate philanthropy these institutions undertake. To estimate the models, we used the Generalized Method of Moments (GMM) approach. The findings demonstrate that the bank’s management board’s compensation significantly influences the size and scope of corporate philanthropy. Moreover, the study reveals that financial institutions consider their financial situation when formulating strategies for implementing corporate philanthropy. Notably, the analysis highlights that the increase in variable components of management board compensation has a more pronounced effect on corporate philanthropy’s volume and range than fixed compensation. These results shed light on aligning management board compensation with social responsibility objectives in financial institutions. By understanding the influence of compensation structures on corporate philanthropy, organizations can take conscious decisions to enhance their social impact while considering their financial performance. This study contributes to the growing literature on corporate social responsibility and provides valuable insights for practitioners, regulators, and stakeholders in the financial industry.
Databáze: Directory of Open Access Journals
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