Values,Authenticity, and Responsible Leadership

Of the many ethical corporate marketing practices, many firms use corporate social responsibility (CSR) communication to enhance their corporate image. Yet, consumers, overwhelmed by these more or less well-founded CSR claims, often have trouble identifying truly responsible firms. This confusion encourages ‘greenwashing’ and may make CSR initiatives less effective. On the basis of attribution theory, this study investigates the role of independent sustainability ratings on consumers’ responses to companies’ CSR communication. Experimental results indicate the negative effect of a poor sustainability rating for corporate brand evaluations in the case of CSR communication, because consumers infer less intrinsic motives by the brand. Sustainability ratings thus could act to deter ‘greenwashing’ and encourage virtuous firms to persevere in their CSR practices.     

How does social trust affect corporate financial performance? The mediating role of corporate social responsibility

Prior studies assert that social trust may positively influence the economic performance of countries and firms (within those countries). This paper proposes a more nuanced mechanism whereby corporate social responsibility (CSR) mediates the relationship between country-level social trust and firm-level financial performance. Anchored in neo-institutional theory, we theorize that social trust instills norms of trustworthiness and willingness to trust others guiding individual and corporate behaviors. In order to comply with such norms and gain legitimacy, firms in high-trust society are more likely to commit to CSR activities that serve the interests of stakeholders. CSR activities, in turn, can positively influence financial performance by enabling firms to access stakeholders' resources and capabilities and to decrease transactions costs in the stakeholder relationships. We tested our theory by analyzing 9818 firm-year observations across 34 countries, during the 2006 to 2015 period. Our analysis shows the expected CSR mediation in the relationship between social trust and firm-level financial performance. Our findings are robust across different models addressing the concerns of endogeneity, alternative measures, and potential moderators.     

企业成长过程中的社会责任认知与行动战略

文章从利益相关者角度出发,以一个动态的视角来考察企业成长与企业社会责任之间的关系。通过对319份有效问卷的实证分析,文章基本证实了不同规模的企业、处在不同生命周期阶段的企业对社会责任的认知是存有差异的,企业在不断成长的过程中会采用不同的行动战略来承担社会责任。强求所有的企业都承担等量的社会责任,不仅不利于企业的持续成长,相反还会阻碍企业在承担社会责任方面采取实际行动。     

Do Lenders Value Corporate Social Responsibility? Evidence from China

Drawing on risk mitigation theory, this article examines whether the improvement of firms’ social performance reduces debt financing costs (CDFs) in China, the world’s largest emerging market. Employing both the ordinary least square (OLS) and the two-stage instrumental variable regression methods, we find that improved corporate social responsibility (CSR) reduces the CDF when firms’ CSR investment is lower than an optimal level; however, this relationship is reversed after the CSR investment exceeds the optimal level. Firms with extremely low or extremely high CSR are subject to a higher CDF. The results also suggest that the optimal CSR level for small firms is higher than that for large firms. This study is the first to document a U-shaped relationship between CSR and CDF and also the first to investigate this relationship within an emerging market context.     

Analyst coverage,corporate social responsibility,and firm risk

This article examines the empirical association between analyst coverage and corporate social responsibility (CSR) by investigating their simultaneous and causal effects, and its joint effects of CSR engagement and analyst coverage on firm risk. We find a positive association between the level and change of CSR engagement and the level and change of analyst coverage after considering simultaneity and causality. Based on the first‐difference approach, we further find that the change in analyst following from the previous year affects the change in CSR in the current period, whereas the change in CSR from the previous period does not influence the change in analyst following in the current period. Furthermore, we find that the change in CSR engagement as well as the interaction effect of changes in CSR and analyst coverage reduces the change of firm risk. When we examine the CSR strengths and concerns separately, analyst following does not significantly influence firms’ CSR strength but CSR concern activities decreases significantly as firms have more analyst followings. We further find the mediating role of financial analysts between CSR concerns (but not CSR strengths) and firm risk. We maintain that analysts provide indirect but additional social pressure to the firms to eventually reduce their irresponsible activities. Taken together, we interpret these results to support the stakeholder theory‐based conflict‐resolution explanation that considers CSR engagement as a vehicle to reduce conflicts of interest between managers and noninvesting stakeholders but not the overinvestment hypothesis that views CSR as a waste of valuable resources at the cost of shareholders.     

Do Leveraged Firms Underinvest in Corporate Social Responsibility? Evidence from Health and Safety Programs in U.S. Firms

The explosion of health-related costs in U.S. firms over more than a decade is a huge concern for managers. The initiation of Health and Safety (H&;S) programs at the firm level is an adequate Corporate Social Responsibility (CSR) initiative to contain this evolution. However, in spite of their documented efficiency, firms underinvest in those programs. This appears as a puzzle for health economists. In this paper, we uncover a strong negative relation of financial leverage to the implementation of H&;S programs. The negative impact of debt on investment and CSR activities is generally interpreted as an efficient disciplinary effect of debt on managers. H&;S are particularly well suited to revisit this evidence, given their strong profitability and homogeneity across firms. Very interestingly, the negative effect is stronger for firms with high free cash flows, for which debt is used to prevent overinvestment. This strongly suggests that debt, while disciplining managers, also discourages investments which are valuable both for firms and society.     

An Exploratory Cross-Cultural Analysis of Marketing Ethics: The Case of Turkish,Thai, and American Businesspeople

Although a number of studies have shown that corporate social responsibility (CSR) activities often lead to greater organisational performance in western developed economies, researchers are yet to examine the strategic value of CSR in emerging economies. Using survey data from 280 firms operating in Dubai, this study examines the link between CSR activities and organisational performance. The results show that CSR has a positive relationship with all three measures of organisational performance: financial performance, employee commitment, and corporate reputation. These results reinforce the accumulating body of empirical support for the positive impact of CSR on performance and challenge the dominant assumption that, given the weak institutional framework in emerging economies, CSR activities drain resources and compromise firms’ competitiveness.     

Positive and Negative Corporate Social Responsibility, Financial Leverage, and Idiosyncratic Risk

Existing research on the financial implications of corporate social responsibility (CSR) for firms has predominantly focused on positive aspects of CSR, overlooking that firms also undertake actions and initiatives that qualify as negative CSR. Moreover, studies in this area have not investigated how both positive and negative CSR affect the financial risk of firms. As such, in this research, the authors provide a framework linking both positive and negative CSR to idiosyncratic risk of firms. While investigating these relationships, the authors also analyze the moderating role of financial leverage of firms. Overall, analysis of secondary information for firms from multiple industries over the years 2000–2009 shows that CSR has a significant effect on the idiosyncratic risk of firms, with positive CSR reducing risk and negative CSR increasing it. Results also show that the reduction in risk from positive CSR is not guaranteed, with firms having high levels of financial leverage witnessing lower idiosyncratic risk reduction.     

Capital Structure and Mergers: Retrospective Evidence from a Natural Experiment

This analysis evaluates the impact of corporate debt in influencing mergers of local exchange companies in the United States telecommunications industry between 1988 and 2001. Firms’ financial structures significantly affect behavior and performance; yet no evidence has shown how firms’ financial structures influence their merger activities. The impact of corporate debt levels on the various mergers that took place during the merger wave in the sector is significantly negative for the first set of mergers carried out, and significantly negative, but with smaller impact, for the second set of mergers. The results support the idea that firms with high debt levels can be monitored carefully, precluding engagement in potentially-risky mergers so as to not engender negative financial outcomes.     

Formal vs. Informal CSR Strategies: Evidence from Italian Micro, Small, Medium-sized, and Large Firms

Recent research on corporate social responsibility (CSR) suggests the need for further exploration into the relationship between small and medium-sized enterprises (SMEs) and CSR. SMEs rarely use the language of CSR to describe their activities, but informal CSR strategies play a large part in them. The goal of this article is to investigate whether differences exist between the formal and informal CSR strategies through which firms manage relations with and the claims of their stakeholders. In this context, formal CSR strategies seem to characterize large firms while informal CSR strategies prevail among micro, small, and medium-sized enterprises. We use a sample of 3,626 Italian firms to investigate our research questions. Based on a multi-stakeholder framework, the analysis provides evidence that small businesses’ use of CSR, involving strategies with an important impact on the bottom line, reflects an attempt to secure their license to operate in the communities; while large firms rarely make attempts to integrate their CSR strategies into explicit management systems.     

Examining the relationship between negative media coverage and corporate social responsibility

This study investigates the relationship between negative media coverage and corporate social responsibility (CSR). We suggest that CSR can compensate for the loss of legitimacy in a firm only when it receives negative media coverage of a given magnitude. Using a sample of Chinese listed firms, the results suggest that in relation to CSR, negative media coverage has an inverted U-shaped curve. When we explore two industrial-level boundary conditions, we find that this nonlinear relationship is more pronounced in firms with higher industrial concentration and dynamism. The results are robust after controlling for endogeneity. This study contributes to CSR and communication literature by deepening our understanding of the nonlinear impact of negative media coverage on firms.     

Determinants of Consumer Attributions of Corporate Social Responsibility

Prior research has found attributions to mediate the relationship between the elements of corporate social responsibility (CSR) activities and consumer responses to firms; however, the question of what variables determine consumer attributions of CSR remains partially unaddressed. This article analyzes why consumers make attributions of CSR that are either positive (values-driven or strategic motives), or negative (stakeholder-driven or egoistic motives). The results obtained from two empirical studies (n = 197, n = 222) indicate that company–cause fit, corporate ability, and interpersonal trust have a positive influence on the motives that consumers attribute to CSR, whereas corporate hypocrisy has a negative effect. This research contributes to our understanding of the psychological mechanisms underlying impactful consumer judgments and provides guidance for organizations in responding to such evaluations.     

Corporate Social Responsibility: Is it Rewarded by the Corporate Bond Market? A Critical Note

The question of whether corporate social responsibility (CSR) has a positive impact on firm value has been almost exclusively analysed from the perspective of the stock market. We have therefore investigated the relationship between the valuation of Euro corporate bonds and the standards of CSR of mainly European companies for the first time in this article. Generally, the debt market exhibits a considerable weight for corporate finance, for which reason creditors should basically play a significant role in the transmission of CSR into the valuation of financial instruments. Given that socially responsible firms are often regarded as economically more successful and less risky, they should have lower risk premia. The results of the empirical analysis, however, reveal that based on an extensive data panel the risk premium for socially responsible firms – according to the classification by SAM Group – was ceterius paribus higher than for non-socially responsible companies. However, only one case of the models investigated was weakly significant. Thus, largely the relationship has to be classified as marginal; so CSR has apparently not yet been incorporated into the pricing of corporate bonds.     

The Impact of FDI Inflow on Domestic Firms’ Uptake of CSR Activities: The Moderating Effects of Host Institutions

This study examines whether foreign direct investment (FDI) inflow helps or hinders local firms’ uptake of corporate social responsibility (CSR) activities in a developing host country. The study further examines the interaction effect of host institutions on the relationship between FDI inflow and local firms’ uptake of CSR activities. Results of hierarchical regression analysis of data from a sample of 227 local firms in Ghana, reveal that local firms’ uptake of CSR improves significantly with an increasing inflow of FDI through knowledge transfer. Host institutions are also found to influence the transfer of CSR activities from foreign firms to local firms. However, when the quality of institutions is very high, the impact of FDI on local firms’ CSR activities diminishes. Research and practical implications of these findings are discussed. © 2015 Wiley Periodicals, Inc.     

Corporate Social Responsibility,Ownership Structure,and Political Interference: Evidence from China

Prior research suggests that ownership structure is associated to corporate social responsibility (CSR) in developed countries. This article examines whether and how ownership structure affects CSR in emerging markets using Chinese firms’ social responsibility ranking. Our empirical evidences show that for non-state-owned firms, corporate ownership dispersion is positively associated to CSR. However, for state-owned firms, whose controlling shareholder is the state, this relation is reversed. We attribute the reversed relationship to political interferences and further test this hypothesis by demonstrating that regional economic development is negatively related to CSR for state-owned firms due to decreased political interference in more developed areas. This study is the first to directly examine the relationship between the dispersion of corporate ownership and CSR in emerging markets, and our results depict that it is important to consider ownership type in assessing CSR in emerging market where state ownership is still prevalent such as China. The results also reveal that firm size, profitability, employee power, leverage, and growth opportunity affect CSR in China.     

Political embeddedness,media positioning and corporate social responsibility: Evidence from China

We examine the effect of political embeddedness and media positioning on corporate social responsibility (CSR). Using a sample of Chinese listed firms from 2009–2017, we provide evidence that firms with political embeddedness from the perspectives of both government ownership and managerial political connection (PC) perform more CSR than other firms, but their motivations for doing so are different. Employing media positioning, we find that firms controlled by the government conduct less CSR when they receive more positive media reporting, indicating that this is a firm's passive choice due to political pressure; and firms with PC are incentivized by negative media reporting to conduct more CSR, indicating an active choice to maintain political legitimacy. This association is robust to different media positioning measurements and endogeneity checks. Additional analyses show that this relationship is more pronounced in central government-controlled firms and regionally politically connected firms; in firms that disclose CSR reports voluntarily; and in the environment where CSR are more valued (following the 2012 national Anti-corruption Campaign and in provinces with higher levels of marketization). Overall, our study suggests that media positioning can help to identify the motivation for conducting CSR.     

On the Determinants of Corporate Social Responsibility: International Evidence on the Financial Industry

This article sets out to undertake a thorough, point-by-point examination of the theory postulated by Campbell (2007), in which an attempt is made to specify the conditions under which corporations may or may not act in socially responsible ways. In order to ensure the overall reliability of our study, and to attempt to provide a new understanding of, and greater insights into, whether corporate social responsibility (CSR) is affected by financial and institutional variables, we empirically investigate a total of 520 financial firms in 34 countries, between the years 2003 and 2005. Our empirical findings are: (i) firms with larger size are more CSR minded, and the financial performance and CSR are not related; (ii) firms would actually act in more socially responsible ways to enhance their competitive advantages when the market competitiveness is more intense; (iii) financial firms in countries with stronger levels of legal enforcement tend to engage in more CSR activities; however, interestingly and rather strikingly, those firms in countries with stronger shareholder rights tend to engage in less CSR activities; and (iv) self-regulation within the financial industry has a significantly positive effect on CSR, with firms being found to act in more socially responsible ways in those countries which have more cooperative employer–employee relations, higher quality management schools, and a better macroeconomic environment.     

Do Suppliers Applaud Corporate Social Performance?

The influence of corporate social performance (CSP) on stakeholders is one of the focal issues in corporate social responsibility (CSR) research. Using data of listed companies in China, this paper examines whether CSR behavior in the form of charitable donations garners a positive reaction from suppliers. Results derived from both level and change model regressions show that superior CSP makes it easier for a firm to obtain trade credit from suppliers, although the effect is significant only in non-state-owned enterprises (non-SOEs). The results are robust to various measures of CSP and endogeneity tests. The results support the strategic philanthropy view and apply stakeholder theory in supply chain, that strategic CSR can help firms to attract suppliers and consolidate cooperative relationships with them, which in turn benefits the firms in terms of more trade credit financing from suppliers. This paper also shows that state-owned enterprises and non-SOEs have different CSR intentions and use CSR to achieve strategic goals in different ways. The conclusions drawn from this study provide practical guidance on CSR strategy, suggesting that CSR activities can help a firm in transition economies to enhance its corporate image, establish and consolidate the good relationship with suppliers, and obtain economic benefits or achieve long-term business objectives.     

Do negative investor attitudes drive corporate social responsibility? Evidence from China

This study explores the association between negative investor attitudes and corporate social responsibility. We conjecture that negative investor attitudes may drive firms to engage more actively in corporate social responsibility to improve shareholder perceptions. Consistent with this expectation, we find that firms facing negative investor attitudes exhibit better CSR performance, and this association is more pronounced in firms that receive more attention from investors and attach more importance to investor relationships. Overall, this study highlights the influence of investor attitudes on corporate social responsibility and contributes to the literature on the determinants of corporate social responsibility.     

Firm performance,corporate ownership,and corporate social responsibility disclosure in China

The existing literature provides conflicting results on the association between firm performance and corporate social responsibility (CSR) disclosure. This paper empirically examines the effect of firm performance on CSR disclosure in terms of disclosure frequency and quality among Chinese listed firms and the possible mediating effect of corporate ownership on the relationship between firm performance and CSR disclosure. Our findings show that better‐performing firms are more likely than worse‐performing ones to disclose CSR information and to produce higher quality CSR reports. In addition, the link between firm performance and CSR disclosure is found to be weaker among state‐owned enterprises compared with non‐state‐owned ones.