TITLE:
Corporate Governance and Corporate Performance with a Mediating Role of Corporate Social Responsibility—Case Study of Companies Listed on Saudi Arabian Exchange
AUTHORS:
Aamir Sarwar, Mamdouh Abdulaziz Saleh Al-Faryan, Madiha Saleem
KEYWORDS:
Corporate Governance, Corporate Social Responsibility, Corporate Performance, Mediator, Saudi Arabian Stock Exchange
JOURNAL NAME:
Theoretical Economics Letters,
Vol.12 No.4,
August
25,
2022
ABSTRACT: The goal of the research was to find out how
Corporate Governance, Corporate Social Responsibility, and Corporate
Performance are linked in Saudi Arabian capital market. Domestic companies
registered on the Arabian stock exchange make up the majority of the
population. The research spans 11 years and includes data from 2010 to 2020.
Data was extracted from audited annual
reports of domestic companies listed on Saudi Arabian Exchange (SAE). The
Hausman Test was used to determine that the Random Effect model was the
best fit. To find endogeneity, we employed the
Durbin-WU-Hausman test and the TSLS rather than the OLS. A model has been
proposed to examine the relationship between corporate governance and
performance, as well as that of corporate social responsibility (CSR) that acts
as a partial mediator. This study has implications for the current and
potential investors of the firms in the Kingdom Saudi Arabia in the context of
choosing “socially participating” firms for their investment. Theoretically,
this study also contributes to our understanding of some related concepts that
have not been explored in previous researches concerning CG, CP and CSR. This
can also be deduced from the finding that CSR partially contribute to enhance a
firm’s performance in the context of Saudi companies.