Women on corporate boards of directors and their influence on corporate philanthropy

Headnote

ABSTRACT. This study examined the relationship between the proportion of women serving on firms' boards of directors and the extent to which these same firms engaged in charitable giving activities. Using a sample of 185 Fortune 500 firms for the 1991-1994 time period, the results provide strong support for the notion that firms having a higher proportion of women serving on their boards do engage in charitable giving to a greater extent than firms having a lower proportion of women serving on their boards. Further, the results suggest a link between the percentage of women on boards and firm philanthropy in the areas of community service and the arts, but found no link between women boardmembers and firm giving to support education or public policy issues. The implications of the findings and some areas for future research are discussed.

KEY WORDS: boards of directors, corporate philanthropy, female directors, firm reputation, inside directors, outside directors

In recent years, the number of women serving on corporate boards of directors has been steadily increasing. Although still relatively small in number, there is some anecdotal evidence that the number of women serving on a firm's board does exert some influence on the level of a firm's involvement in activities related to corporate social responsibility (CSR) (Stanwick and Stanwick, 1998; Wang and Coffey, 1992). One component of CSR, the firm's level of charitable giving and how it is influenced by the number of women serving on the firm's board, has been the subject of some limited research interest in recent years (Ibrahim and Angelidis, 1994; Wang and Coffey, 1992).

Background

Women are slowly gaining on men in their practice of philanthropy, especially in the realm of corporate philanthropy. As the percentage of women serving on corporate boards steadily increases, women will play a larger role in determining how firms allocate their budgets for charitable activities. Professional fundraisers and development officers should be prepared to learn more about those factors that motivate women in their charitable giving. Being knowledgeable of these factors will assist the professional fundraiser in allocating his/her limited time and resources, and should improve his/her chances of reaching fundraising goals (Newman, 1996).

Recently, several characteristics about women and their motivation to give to charity have been identified...