Introduction
Labour and Human Rights
Hypotheses Development
Team Management Diversity and Labour Practices, Decent Work, and Human Rights Performance and Reporting
The Mediating Role of LA&HR Performance
Methodology
Population and Sample
Panel A. Geographic description | |
---|---|
Country | % |
AUSTRALIA | 3.57 |
AUSTRIA | 0.21 |
BELGIUM | 0.74 |
BRAZIL | 2.39 |
CANADA | 4.11 |
CHILE | 0.40 |
CHINA | 3.32 |
COLOMBIA | 0.40 |
CZECH REPUBLIC | 0.11 |
DENMARK | 1.26 |
FINLAND | 1.67 |
FRANCE | 4.02 |
GERMANY | 3.30 |
GREECE | 0.46 |
HONG KONG | 2.32 |
HUNGARY | 0.16 |
INDIA | 2.02 |
INDONESIA | 0.63 |
IRELAND | 0.54 |
ISRAEL | 0.33 |
ITALY | 1.42 |
JAPAN | 13.84 |
ERSEY | 0.05 |
KOREA (SOUTH) | 3.67 |
KUWAIT | 0.07 |
LUXEMBURG | 0.32 |
MALAYSIA | 1.16 |
MEXICO | 0.88 |
NETHERLANDS | 1.00 |
NEW ZEALAND | 0.21 |
ORWAY | 0.83 |
PHILIPPINES | 0.63 |
POLAND | 0.49 |
PORTUGAL | 0.33 |
QATAR | 0.11 |
RUSSIA | 1.09 |
SAUDI ARABIA | 0.07 |
SINGAPORE | 0.74 |
SOUTH AFRICA | 6.73 |
SPAIN | 1.62 |
SWEDEN | 1.86 |
SWITZERLAND | 2.18 |
TAIWAN | 5.23 |
THAILAND | 1.09 |
TURKEY | 0.51 |
UNITED KINGDOM | 9.13 |
UNITED STATES | 12.77 |
Panel B. Sector description | |
---|---|
Sector | % |
Oil and Gas | 5.39 |
Basic Materials | 13.02 |
Industry | 21.52 |
Consumer goods | 13 |
Health | 4.06 |
Consumer services | 10.05 |
Telecommunications | 2.97 |
Public services | 5.66 |
Financial and Real State | 19.09 |
Technology | 5.25 |
Panel C. Time description | |
---|---|
Year | % |
2013 | 18.62 |
2014 | 20.97 |
2015 | 20.17 |
2016 | 21.83 |
2017 | 18.41 |
Empirical Models and Variables
Panel A. Indicators LA&HR_Discl |
---|
LA1. Total number and rates of new employee hires and employee turnover by age group, gender and region |
LA2. Benefits provided to full-time employees that are not provided to temporary or part-time employees |
LA3. Return to work and retention rates after parental leave, by gender |
LA4. Minimum notice periods regarding operational changes |
LA5. Representation on health and safety committees |
LA6. Injuries, occupational diseases, and work-related fatalities |
LA7. Workers with high incidence or high risk of diseases related to their occupation |
LA8. Health and safety topics covered in formal agreements with trade unions |
LA9. Average hours of training per employee by gender and by employee category |
LA10. Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings |
LA11. Percentage of employees receiving a regular performance appraisal and career development review, by gender and by employee category |
LA12. Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity |
LA13. Ratio of basic salary and remuneration of women to men by employee category, by significant locations of operation |
LA14. Percentage of new suppliers that were screened using labor practices criteria |
LA15. Significant actual and potential negative impacts for labor practices in the supply chain and actions taken |
LA16. Number of grievances about labour practices filed, addressed, and resolved through formal grievance mechanisms |
HR3. Total number of incidents of discrimination and action taken |
HR4. Operations and suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or at significant risk, and measures taken to support these rights |
HR5. Operations and suppliers identified as having significant risk for incidents of child labor, and measures taken to contribute to the effective abolition of child labor |
HR6. Operations and suppliers at significant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor |
HR7. Percentage of security personnel trained in the organization’s human rights policies or procedures that are relevant to operations |
HR8. Total number of Incidents of violations involving rights of indigenous peoples and actions taken |
HR12. Number of grievances about human rights impacts filed, addressed, and resolved |
Panel B. Items of LA&HR_Perf |
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KPIs1. The company claims to provide flexible working hours or programs that promote a work–life balance |
KPIs2. The company has a diversity and equal opportunity policy |
KPIs3. The company has a policy for maintaining a well-balanced membership of the board |
KPIs4. The company claims to favor promotion from within |
KPIs5. The company has a policy to support the skills training or career development of its employees |
KPIs6. The company has a competitive employee benefits policy or ensure good employee relations within its supply chain and the company has a policy for maintaining long-term employment growth and stability |
KPIs7. The company has a policy to improve employee health & safety within the company and its supply chain |
KPIs8. The company reports on policies or programs on HIV/AIDS for the workplace or beyond |
KPIs9. The company claims to provide its employees with a pension fund, health care, or other insurance KPIs10. The company claims to provide a bonus plan to most employees |
KPIs11. The company claims to provide daycare services for its employees |
KPIs12. The company reports or show to use human rights criteria in the selection or monitoring process of its suppliers or sourcing partners |
KPIs13. The company has a policy to guarantee the freedom of association universally applied independent of local laws and the company has a policy for the exclusion of child, forced, or compulsory labor KPIs14. The company shows to be ready to end a partnership with a sourcing partner if human rights criteria are not met |
KPIs15. The company has a policy to respect business ethics –ethics code, codes of conducts, compliance policies, etc.—or has signed the UN Global Compact or does it follow the OECD guidelines |
KPIs16. The company has a commitment towards being a good citizen or endorse the Global Sullivan Principles |
Panel C. Independent and control variables | |||
---|---|---|---|
Variable | Definition | Studies | Expected sign |
Female_Managers | Percentage of female managers | + | |
Size | Natural logarithm of total assets | + | |
ROA | Return-on-assets ratio | + | |
Leverage | Proportion of debt with respect to total assets | − | |
Internacio | Percentage of investments in assets made in other countries | Cahaya et al. (2017) | + |
Cash | Liquid money and other means that can be readily converted into money | Aibar-Guzmán and Somohano-Rodríguez (2021) | + |
DLoss | Dummy that takes the value 1 if the company has obtained losses in the financial year, and 0 otherwise | García-Sánchez and García-Meca (2018) | − |
Accruals | Total accruals scaled by cash flow from operations | García-Sánchez et al. (2021) | + |
Cov_Ana | The number of analysts following the company | + | |
CSR_Comm | Dummy that takes the value 1 if there is a CSR committee on the board of directors, and 0 otherwise | + | |
B_Indep | Percentage of independent directors on the board | + | |
B_Women | Percentage of female directors on the board | + | |
DLawsuits | Dummy that takes the value 1 if the company operates in lawsuit-prone industries, and 0 otherwise | + | |
NCSRPI | Level of orientation towards the stakeholders of the firm’s country of origin (Amor-Esteban et al., 2019) | ||
ICSRPI | Aggregate indicator of institutional pressures at the sectoral level (Amor-Esteban et al., 2018) |
Results
Descriptives and Correlations
Variable | % | |
---|---|---|
LA&HR Full Disclosure | 0.27 | |
LA&HR Partial Disclosure | 0.36 | |
DLoss | 0.06 | |
CSR_Comm | 0.66 | |
Dlawsuits | 0.15 |
Variable | Mean | Std. Dev |
---|---|---|
Female_Managers | 0.24 | 0.15 |
LA&HR_Perf | 9.28 | 2.77 |
Size | 17.99 | 2.80 |
ROA | 5.12 | 8.43 |
Leverage | 0.25 | 0.17 |
Internaci | 0.19 | 0.24 |
Cash | 11.80 | 0.66 |
Accruals | 10.83 | 0.48 |
Cov_Ana | 16.11 | 9.55 |
B_Indep | 0.46 | 0.30 |
B_Women | 0.14 | 0.12 |
NCSRPI | 1.65 | 8.79 |
ICSRPI | 0.57 | 3.03 |
1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | ||
---|---|---|---|---|---|---|---|---|---|
1 | LA&HR_Discl | 1 | |||||||
2 | Fema_Mang | − 0.02 | 1 | ||||||
3 | LA&HR_Perf | 0.39*** | 0.13*** | 1 | |||||
4 | Size | 0.13*** | − 0.15*** | − 0.09*** | 1 | ||||
5 | ROA | 0.01 | 0.14*** | 0.06*** | − 0.11*** | 1 | |||
6 | Leverage | 0.05*** | − 0.03 | − 0.03*** | 0.02 | − 0.15*** | 1 | ||
7 | Internacio | 0.08*** | − 0.03 | 0.15*** | − 0.22*** | − 0.07*** | − 0.02 | 1 | |
8 | Cash | 0.08*** | − 0.15*** | 0.01 | 0.41*** | − 0.01 | − 0.02 | − 0.09*** | 1 |
9 | DLoss | 0.00 | − 0.07*** | − 0.01 | − 0.04*** | − 0.30*** | 0.13*** | 0.11*** | − 0.01 |
10 | Accruals | 0.00 | − 0.02 | 0.00 | − 0.02 | − 0.01 | − 0.02 | 0.00 | 0.00 |
11 | Cov_Ana | 0.25*** | 0.07*** | 0.37*** | 0.22*** | 0.05*** | − 0.05*** | 0.07*** | 0.13*** |
12 | B_Indep | − 0.03*** | 0.12*** | 0.18*** | − 0.19*** | 0.05*** | 0.05*** | 0.07*** | − 0.03*** |
13 | CSR_Comm | 0.21*** | 0.02 | 0.35*** | 0.03*** | 0.00 | 0.03** | 0.02 | 0.00 |
14 | B_Women | 0.04*** | 0.18*** | 0.27*** | − 0.22*** | 0.07*** | − 0.01 | 0.03** | − 0.10*** |
15 | DLawsuits | 0.07*** | − 0.03* | 0.11*** | − 0.03** | 0.05*** | − 0.08*** | 0.07*** | − 0.01 |
16 | NCSRPI | 0.04*** | 0.05*** | 0.10*** | − 0.33*** | 0.00 | − 0.10*** | 0.25*** | − 0.09*** |
17 | ICSRPI | 0.06*** | − 0.48*** | 0.04*** | − 0.09*** | − 0.10*** | 0.11*** | 0.17*** | 0.01 |
9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | ||
9 | DLoss | 1 | |||||||
10 | Accruals | 0.00 | 1 | ||||||
11 | Cov_Ana | 0.01 | − 0.02* | 1 | |||||
12 | B_Indep | 0.01 | − 0.02 | 0.13*** | 1 | ||||
13 | CSR_Comm | 0.01 | 0.02 | 0.06*** | 0.04*** | 1 | |||
14 | B_Women | − 0.04*** | 0.00 | 0.05*** | 0.32*** | 0.13*** | 1 | ||
15 | DLawsuits | 0.04*** | − 0.03** | 0.16*** | 0.08*** | 0.04*** | 0.00 | 1 | |
16 | NCSRPI | 0.03** | 0.02 | − 0.17*** | − 0.02 | 0.05*** | 0.15*** | − 0.02* | 1 |
17 | ICSRPI | 0.10*** | 0.01 | − 0.05*** | − 0.01 | 0.01 | − 0.08*** | 0.05*** | − 0.07*** |
Main Findings
Panel A. Mediator effect (*** p < 0.01, ** p < 0.05, * p < 0.1) | |||
---|---|---|---|
LA&HR_Perf | |||
Equ. [1] | Coeff. Bootstrap | Robust | |
Coeff. (Std.error) | Coeff. (Std.error) | Coeff. (Std.error) | |
LA&HR_Perft-1 | 0.770*** | ||
(0.0191) | |||
Fema_Manag | 0.0290*** | 0.0290*** | 0.0122*** |
(0.00737) | (0.0119) | (0.00399) | |
Size | 0.00268 | 0.0027 | 0.0478* |
(0.0508) | (0.0679) | (0.0261) | |
ROA | 0.0178 | 0.0178 | 0.00678 |
(0.0110) | (0.0183) | (0.00732) | |
Leverage | − 0.000127 | − 0.0001 | − 0.000759 |
(0.00528) | (0.0084) | (0.00284) | |
Internacio | 0.00663* | 0.0066 | 0.00215 |
(0.00340) | (0.0044) | (0.00204) | |
Cash | 5.68e-10 | 0.000 | 0.000 |
(3.93e-10) | (0.000) | (2.04e-10) | |
DLoss | 0.142 | 0.1422 | − 0.0607 |
(0.306) | (0.5022) | (0.253) | |
Accruals | − 0.000344 | − 0.0003 | 0.000683 |
(0.00122) | (0.0022) | (0.00121) | |
Cov_Ana | 0.0839*** | 0.0839*** | 0.0182*** |
(0.0110) | (0.0168) | (0.00621) | |
B_Indep | − 0.00387 | − 0.0039 | − 0.000981 |
(0.00243) | (0.0031) | (0.00172) | |
CSR_Comm | 0.186 | 0.1863 | − 0.603*** |
(0.140) | (0.2253) | (0.111) | |
B_Women | 0.0210*** | 0.0210** | − 0.00437 |
(0.00602) | (0.0094) | (0.00452) | |
DLawsuits | 0.367 | 0.3674 | 0.126 |
(0.272) | (0.2746) | (0.129) | |
NCSRPI | − 0.00393 | − 0.0039 | 0.000714 |
(0.0119) | (0.0167) | (0.00612) | |
ICSRPI | 0.228*** | 0.2280*** | 0.0556** |
(0.0471) | (0.0566) | (0.0234) | |
Industry, country and year controlled | |||
Log Likelihood | − 27.992.429 | − 27.992.429 | − 25.078.263 |
p-value | 0.000 | 0.000 | 0.000 |
Panel B. Direct Effect (*** p < 0.01, ** p < 0.05, * p < 0.1) | |||
---|---|---|---|
LA&HR_Discl | |||
Equ. [2] | Coeff. Bootstrap | Robust | |
Coeff. (Std.error) | Coeff. (Std.error) | Coeff. (Std.error) | |
LA&HR_Disclt-1 | 2.620*** | ||
(0.164) | |||
Fema_Manag | 0.00917 | 0.0092 | 0.00435 |
(0.0110) | (0.0134) | (0.00644) | |
LA&HR_Perf | 0.278*** | 0.2782*** | 0.0973*** |
(0.0518) | (0.0757) | (0.0329) | |
Size | 0.184** | 0.1838 | 0.0649 |
(0.0748) | (0.1248) | (0.0434) | |
ROA | 0.0176 | 0.0176 | 0.00997 |
(0.0191) | (0.0186) | (0.0124) | |
Leverage | 0.0212*** | 0.0212** | 0.0104** |
(0.00792) | (0.0097) | (0.00459) | |
Internacio | 0.00396 | 0.004 | − 0.000762 |
(0.00532) | (0.007) | (0.00328) | |
Cash | 1.75e-10 | 0.000 | 1.29e-10 |
(5.43e-10) | (0.000) | (3.14e-10) | |
DLoss | 0.287 | 0.2869 | 0.237 |
(0.535) | (0.8759) | (0.391) | |
Accruals | − 0.00125 | − 0.0012 | − 0.000320 |
(0.00265) | (0.005) | (0.00209) | |
Cov_Ana | 0.0628*** | 0.0628*** | 0.0301*** |
(0.0171) | (0.02) | (0.0101) | |
B_Indep | − 0.00591 | − 0.0059 | − 0.00269 |
(0.00412) | (0.0054) | (0.00277) | |
CSR_Comm | − 0.0865 | − 0.0865 | − 0.247 |
(0.272) | (0.3668) | (0.187) | |
B_Women | − 0.00806 | − 0.0081 | − 0.0104 |
(0.0107) | (0.0172) | (0.00744) | |
DLawsuits | 0.473 | 0.4726 | 0.146 |
(0.358) | (0.4514) | (0.199) | |
NCSRPI | 0.0428** | 0.0428 | 0.0191** |
(0.0167) | (0.0326) | (0.00967) | |
ICSRPI | 0.152** | 0.1523* | 0.0366 |
(0.0669) | (0.0812) | (0.0379) | |
Industry, country and year controlled | |||
Log Likelihood | − 6.156.365 | − 6.516.365 | − 56.226.907 |
p-value | 0.000 | 0.000 | 0.000 |
Panel C. Direct and Indirect effects (*** p < 0.01, ** p < 0.05, * p < 0.1) | |||
---|---|---|---|
Efecto | Variable | Effect | |
Direct Female_Manag | LA&HR_Perf | φ1 | 0.0290*** |
Direct Female_Manag | LA&HR_Discl | ß1 | 0.00917 |
Mediated or indirect Female_Manag | LA&HR_Discl |
= ß2* φ1 | 0.010*** |
Corrected LA&HR_Perf | LA&HR_Discl | ß2 −
| 0.268*** |
Complementary Analyses
Panel A. Results Eq. 2 for ordinal dependent variable | |||
---|---|---|---|
Equ. [2]—LA&HR_OrdDiscl | |||
Coeff (Std.error) | Coeff (Std.error) | Coeff (Std.error) | |
Fema_Manag | 0.0178*** | 0.0142** | |
(0.00678) | (0.00648) | ||
LA&HR_Perf | 0.175*** | 0.144*** | |
(0.0170) | (0.0281) | ||
Size | 0.190*** | 0.108*** | 0.190*** |
(0.0472) | (0.0266) | (0.0449) | |
ROA | 0.0143 | 0.00478 | 0.0119 |
(0.0105) | (0.00604) | (0.0101) | |
Leverage | 0.0130*** | 0.00909*** | 0.0127*** |
(0.00482) | (0.00329) | (0.00461) | |
Internacio | 0.000501 | 0.00229 | − 0.000270 |
(0.00323) | (0.00227) | (0.00311) | |
Cash | 1.10e-10 | 1.27e-10 | 0.000 |
(3.63e-10) | (8.98e-11) | (3.48e-10) | |
DLoss | 0.198 | 0.0733 | 0.181 |
(0.290) | (0.169) | (0.284) | |
Accruals | − 0.00105 | 1.75e-05 | − 0.00111 |
(0.00133) | (6.15e-05) | (0.00134) | |
Cov_Ana | 0.0438*** | 0.0266*** | 0.0301*** |
(0.0102) | (0.00663) | (0.0100) | |
B_Indep | − 0.00119 | − 0.00253 | − 0.00126 |
(0.00229) | (0.00156) | (0.00222) | |
CSR_Comm | 0.247* | − 0.0229 | − 0.00519 |
(0.132) | (0.0898) | (0.139) | |
B_Women | 0.00155 | − 0.00122 | − 0.00479 |
(0.00567) | (0.00397) | (0.00566) | |
DLawsuits | 0.288 | 0.249 | 0.246 |
(0.243) | (0.165) | (0.229) | |
NCSRPI | 0.0101 | 0.00627 | 0.0112 |
(0.0109) | (0.00718) | (0.0103) | |
ICSRPI | 0.159*** | 0.0811*** | 0.125*** |
(0.0429) | (0.0274) | (0.0409) | |
Industry, country and year controlled | |||
Log Likelihood | − 1133.9549 | − 2134.587 | − 1121.1006 |
p-value | 0.000 | 0.000 | 0.000 |
Panel B. Direct and indirect effects (*** p < 0.01, ** p < 0.05, * p < 0.1) | |||
---|---|---|---|
Efect | Variable | Effect | |
Direct Female_Manag | LA&HR_Perf | φ1 | 0.0290*** |
Total Female_Manag | LA&HR_OrdDiscl | ß1 +
| 0.0147** |
Direct Female_Manag | LA&HR_OrdDiscl | ß1 | 0.0142** |
Mediated or indirect Female_Manag | LA&HR_OrdDiscl | = ß2* φ1 | 0.0005** |
Corrected LA&HR_Perf | LA&HR_OrdDiscl | ß2 −
| 0.1435*** |