The board of directors and CSR: How does ideological diversity on the board impact CSR?

Given that ideological differences are likely to become an increasing source of conflict within organizations, we introduce ideological diversity as a new board-level diversity construct and hypothesize its effects on CSR performance. We hypothesize that ideological diversity can have a negative effect on CSR performance through social categorization mechanisms. Alternatively, we introduce a competing hypothesis that suggests a positive effect of ideological diversity on CSR performance through information processing mechanisms. We test our hypotheses on a panel of 372 Dutch municipality boards from 2014 to 2017 using a fixed effects OLS regression. These methods allow us to control for unobserved heterogeneity and is supported by the Hausman test we perform. Results support a negative relationship between board ideological diversity and CSR performance, indicating that a high level of ideological diversity leads to a lower performance in CSR. We discuss the implications of these findings for the board diversity and CSR literatures. (C) 2019 Elsevier Ltd. All rights reserved.