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Extra-financial information concerning how firms deal with environmental, social and governance (ESG) issues is becoming every day more relevant. Financial information, indeed, lacks to provide adequate knowledge about some significant corporate dimension that may lead, in the long run, to firm’s competitive advantage and that is embedded in its citizenship and community legitimacy (Cucari et al., 2018). There is a wide body of literature analyzing these three pillars of sustainable investing (Elkington, 2006), particularly with reference to how these CSR pillars affect firms’ performance (Kong, 2012). The relation between CG and CSR engagement has also been widely investigated (Jo & Harioto, 2012); however, there is a lack in previous studies concerning how the mentioned pillars influence each in the food industry. “NEW CHALLENGES IN CORPORATE GOVERNANCE: THEORY AND PRACTICE” Naples, October 3-4, 2019 54 This empirical research has therefore the purpose to shed more light on the relation between ESG pillars in this specific setting. In particular, the aim of the study is twofold. On one side, according to Jamali et al. (2008), we hypothesize that effective corporate governance (CG) may lead to corporate social and environmental performance (CSEP). On the other side, we investigate if this relation can be moderated by financial slack. To address this gap in the existing literature concerning the food industry, we gathered data from Thomson Reuters Asset4 and Worldscope and we ran multiple regressions on a sample of 324 firms operating in 42 different countries, over a time horizon 2011-2017, with a final sample of 1.379 firms’ year observations. We measured CSEP with the mean of social and environmental score and CG with the corporate governance score (Gangi et al., 2019; Brogi & Lagasio, 2019). Furthermore, we measured financial slack with several variables such as ROI, ROA, ROE, Debt/Equity ratio, Working Capital scaled by total asset, Ebitda/Sales and Altman Z-score (Arora & Dharwadkar, 2011; Waddock & Graves, 1997). Since we hypothesize that CG at time t has an effect on CSEP at time t+1, we measured dependent and independent variables with a 1-year lag. Furthermore, we controlled for country, year, size, growth, capital expenditures and subsectors (producers and retailers). Our findings, reported in Table 1, show that, in the food industry, corporate governance has a strong, positive and significant impact on corporate social and environmental performance. Table 1. OLS regression models showing the relation between CG and CSEP

Corporate governance and corporate social and environmental performance: Does financial slack have a moderating role? Evidence from the food industry