The Corporate Governance (CG), also known has corporate control, and Corporate Social Responsibility (CSR) are correlated whereby; the systems of CG tend to affect CSR practices. This study examines the role of CG elements; specifically, the BOD (Board of Directors) and AC (Audit Committees) on CSR operations of Family-Owned Enterprises (FOEs) in Lebanon. It also looks at the controlling factor of the family members’ involvement in the decision-making process. This research adopted a cross-sectional quantitative design where data was obtained from 203 FOEs using a self-completion survey questionnaire. With reference to the research hypotheses, we employed Structural Equation Modeling (SEM) to test the relationship between CG and CSR. The results highlighted that audit committees are effective in increasing CSR with regard to health by 0.375, refugees by 0.458, and environmental community by 0.379 while BOD impact on CSR was almost negligible. However, family involvement was found to moderate these relationships, where higher level of family involvement enhanced the audit committee’s positive influence on CSR. In FOEs where there was low family involvement, the BOD played a bigger role in CSR with regards to health (p-value = 0.042). This means that perhaps the BOD gets less interference from the families and thus performs optimally in engendering CSR. These results highlight the roles of AC and families regarding CSR performance in FOEs, providing implications for governance.
Keywords
Corporate Governance, Corporate Social Responsibility, Family-Owned Enterprises, Agency Theory, Stakeholder Theory, Classical Test Theory.
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Sun Young
Sun Young
School of Management, Shandong University, Ji Nan Shi, Shan Dong Sheng, China.
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Cite this article
Sun Young, “Impact of Corporate Governance on Corporate Social Responsibility in Family Owned Enterprises in Lebanon”, Journal of Enterprise and Business Intelligence, vol.4, no.1, pp. 022-031, January 2024. doi: 10.53759/5181/JEBI202404003.
