African Journal of
Business Management

  • Abbreviation: Afr. J. Bus. Manage.
  • Language: English
  • ISSN: 1993-8233
  • DOI: 10.5897/AJBM
  • Start Year: 2007
  • Published Articles: 4094

Full Length Research Paper

The impact of board composition on corporate financial and social responsibility performance: Evidence from public-listed companies in Turkey

Kader Sahin1*, Cigdem Sahin Basfirinci2 and Aygun Ozsalih2
  1Department of Business Administration, Karadeniz Technical University, Trabzon, Turkey. 2Public Relations and Advertising Department, Karadeniz Technical University, Trabzon, Turkey.
Email: [email protected]

  •  Accepted: 23 February 2011
  •  Published: 04 April 2011

Abstract

 

In an attempt to explain the relationships between principles of good governance, marketing practices and financial performances of companies in Turkey, the authors examined the inter-relationships between board composition characteristics, corporate social responsibility practices and financial performance in this study. The population of this study is Turkish firms that are listed in the Istanbul Stock Exchange (ISE) in 2007 and have a published corporate governance compliance report. Using content and logistic regression analyses, the authors found that smaller board size leads to better financial performance, whereas inside directors and CEO duality lead to worse financial performance. On the other hand, independent directors lead to better corporate social responsibility. By providing evidence from an emerging country, Turkey, this study provided some meaningful insights into the board of directors’ composition, corporate social responsibility practices and the effects of both on the various financial output of a company. Emphasizing the importance of corporate social responsibility practices and board composition characteristics, the current study offered in-depth information to companies that aim to gain a competitive financial advantage in Turkey.

 

Key words: Turkey, board characteristics, corporate social responsibility, financial performance.