GRADUATE RESEARCH DISSERTATIONS
CHAIR: CANAN MUTLU, PH.D. | SECOND: PATRICIO DURAN, PH.D. | READER: RAJARAM VELIYATH, PH.D.
Examining How Female Board Representation Shapes Corporate Social Responsibility through Internal and External Legitimacy Critical Influence:
BUSINESS IMPACT
SCHOLARLY ABSTRACT
Our study investigates the relationship between board gender diversity and corporate social responsibility (CSR) outcomes by examining the dual sources of legitimacy that empower women directors to influence CSR. Drawing on critical mass theory and institutional legitimacy frame - works, this study posits that female directors derive legit - imacy from internal and external sources. Internal legiti - macy emerges from positional power, specifically through formal leadership roles such as board chair or committee chairs, providing women directors with institutional au - thority to drive CSR initiatives. External legitimacy mani - fests when firms operate within industries characterized by higher female board representation among industry peers, creating normative pressure that facilitates enhanced CSR outcomes. Using a dataset of US based public companies, this study employs quantitative analysis to examine the direct and interactive effects of board gender diversity, critical influence, and industry female board prevalence on CSR performance. Findings reveal that board gender di - versity, critical influence and industry board gender diver - sity significantly predict stronger CSR performance. The study does not find significant interaction effects between critical influence and industry gender prevalence, suggest - ing these legitimacy sources operate independently rather than synergistically. These findings advance theoretical understanding of gender diversity’s impact on corporate governance by identifying specific pathways through which female directors influence organizational outcomes.
Female board representation, especially in leadership roles, is associated with stronger CSR performance. Nominating committees shouldn’t stop at “one woman on the board.” Giving women positional power (board chair, key committee chairs) is a concrete lever to strengthen CSR and ESG execution—relevant for firms targeting sus - tainability-linked financing, indices, and stakeholder trust. Industry‑level female board prevalence creates external legitimacy pressure that supports CSR. For companies lagging peers on gender diversity, there is a competitive and legitimacy risk: as industries normalize higher female representation, boards with few/no women signal misalignment with evolving norms, potentially af - fecting access to capital, talent, and customers. Internal (role-based) and external (industry) legitimacy work independently rather than interactively. Governance teams should design a dual strategy: Internally: place women in influential governance positions. Externally: benchmark and communicate progress against industry norms. Doing one without the other leaves value on the table— either under-leveraging powerful women leaders or miss - ing the signaling benefit to markets and stakeholders.
MARI SIFO, PH.D.
Keywords: Board gender diversity, Corporate Social Responsibility, Institutional Legitimacy
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