How to Lead the Board of Directors to a Sustainable Development of Business with the CSR Committees

Abstract

The sustainable development of business requires adjustments in corporate governance to assure the economic, social and environmental aspects of a firm’s responsibility are managed according to the triple bottom line approach. For this purpose, the board of directors can establish devoted corporate social responsibility (CSR) committees to reduce a company’s exposure to responsibility failures. By means of a quantitative analysis on listed firms on FTSE MIB and STAR markets of the Italian Stock Exchange and embracing different theories this paper aims at finding the potential influence of external (soft law and socio-environmental industry risk) and internal (firm size and ownership structure) factors on the presence of CSR committees. This study contributes to the existing literature about sustainability in business, recommends to directors to not underestimate the risk of ‘strategic unsustainability’, and offers to regulators significant food for thought to improve the contribution to sustainable development by companies.