Recent global financial scandals have brought to light the importance of corporate governance and related issues.
The rights of investors and other stakeholders have thus became vital. As we seek to improve the internal governance
mechanism and enhance actions of corporate social responsibility, the shortage of updated literature on non-financial
social performance greatly hinders the transparency to the problems stated above, making tasks relatively challenging.
In this research we focus on a common characteristic shared by many publicly listed Taiwanese companies whose
control shareholders hold key management positions. In other words, a central agency problem between major and
minor shareholders arises. The purpose of this study is to investigate whether ownership structure is a significant factor
in corporate social performance. The empirical results indicate that when companies have more deviation between
control rights and cash flow rights of control shareholders, they are more likely to have negative corporate social
performance. In addition, companies that have more cash flow rights from control stockholders are less likely to
encounter negative corporate social performance.
Relation:
The Journal of Global Business Management, 5(2),135-142.
