The Impact of Corporate Social Responsibility on Cash Holdings: The Moderating Role of Board Gender Diversity

Abstract

This research investigates the association between corporate social responsibility and cash holdings, while also exploring the moderating effect of board gender diversity on this association. The study utilizes a dataset of non-financial firms listed on the Egyptian Exchange (EGX) from 2012 to 2021, comprising a final sample of 52 firms with a total of 520 firm-year observations. A statistical analysis was performed using pooled OLS, a fixed effects regression analysis, and two-step system GMM estimations to test the research hypotheses. The results show a significant positive association between CSR and cash holdings. Further, board gender diversity is found to have a negative moderating role as it weakens the association between CSR and cash holdings. These findings are relevant for regulators, investors, and stakeholders in Egypt and other emerging markets. Companies are encouraged to prioritize gender diversity in board appointments, while regulators should track and promote female representation in all listed firms. Investors are advised to focus on boards with strong female representation and high CSR disclosure. The insights offered by this research extend the literature by examining the moderating role of gender diversity in an unexplored context, namely Egypt, which fill part of the gap in early studies.