Corporate Political Responsibility and Board Diversity in the United States: A Study of Demographic, Cognitive, and Gender Influences

What the paper says

ABSTRACT Objective This study investigates the impact of board diversity on corporate political responsibility (CPR), focusing on demographic, cognitive, and gender diversity. Methods Using a sample of 412 S&P 500 firms from the United States over 11 years (2012–2022), comprising 4532 firm‐year observations, panel regression techniques were employed to examine the influence of board diversity on corporate political engagement and transparency. Results The findings indicate that all three dimensions of diversity, demographic, cognitive, and gender, positively and significantly affect CPR. Specifically, demographic and cognitive diversity have the strongest impacts, while gender diversity contributes to a more moderate but still meaningful effect. Conclusion The study highlights the critical role of diverse boards in fostering ethical and responsible corporate behavior. By drawing on agency theory, upper echelons theory, and feminist theory, it reveals how diversity strengthens oversight, sharpens ethical awareness, and deepens accountability in political decision‐making. The evidence suggests that diverse boards are better equipped to monitor corporate conduct and to embed fairness and inclusiveness in the governance of political activities. These findings offer valuable insights for corporate leaders, shareholders, policymakers, and society, showing that board diversity enhances governance effectiveness and promotes a more transparent and responsible approach to corporate political engagement.