The Impact of Corporate Social Responsibility Disclosure on Firm Value: The Moderating Role of Board Gender Diversity in French Companies

Abstract

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Corporate social responsibility (CSR) and firm value have aroused the interest of an extensive literature. The relationship between these two strands of research remains thoroughly misunderstood, though. With the aim of offering a refined understanding and validation of the relationship proposed, the current paper aims at studying the relationship between CSR disclosure and firm value, after the transition of the European directive in large French companies, and scrutinising the effect of female boards on this relationship. This study was conducted by applying the Ohlson model (1995) among the largest companies listed on the CAC All-Tradable index for the period 2017-2019. The results of the study revealed a positive association between CSR disclosure and firm value after the transposition of the EU directive. Furthermore, we evince that gender diversity on boards enhances this relationship. To the best of our knowledge, this is a first attempt at studying whether the transition of the EU directive influences the value relevance of the directive’s CSR disclosure requirements in large French companies. In addition, this study extends the existing literature by examining the effect of female boards. The outcomes may be of interest to academic researchers, investors, and regulators. For academic researchers, it is interesting to find out how the transition of the EU directive can improve the relevance of CSR disclosure. For investors, the results show the value of CSR practices in their business.

Keywords: CSR Disclosure, Firm Value, Board Gender Diversity, EU Directive

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