Interlocking directorates, CSR adoption, and firm reputation in developing countries

Abstract Purpose: This study investigates how interlocking directorates shape corporate social responsibility (CSR) adoption and influence firm reputation in Mexico’s emerging market context. While institutional theory highlights interlocks as channels for norm diffusion, their reputational effects remain underexplored in developing economies. Originality/value: This study enriches the literature on non-market strate-gies in weak institutional contexts by examining Mexico. It advances understanding of firm reputation as a strategic outcome of CSR adoption and shows how interlocking directorates guide corporate behavior in contexts in which formal institutions are insufficient. Design/methodology/approach: The study analyzes a panel of 140 firms listed on Mexico’s two stock exchanges (Bolsa Mexicana de Valores [BMV] and Bolsa Institucional de Valores [BIVA]) from 2016 to 2022. Annual report data let us map board interlocks, CSR adoption, and firm reputation. Social-network analysis captures directors’ connectivity across firms, and logistic-regression models, estimated after multiple imputation of missing values, test the relationships with improved statistical reliability. Findings: The results show that interlocking directorates significantly increase the likelihood of CSR adoption, which, in turn, positively affects firm reputation. These findings highlight peer influence and board interconnections as crucial mechanisms for CSR diffusion in institutional settings marked by regulatory gaps. Practical implications: The findings emphasize the value of strategic board composition and interlocks in promoting CSR practices. In emerging markets such as Mexico, firms can leverage public perception through interlocking directorates, strengthening reputation in the absence of strong regulatory enforcement.