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Institutional investors and corporate environmental and financial performance |
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| Authors: | Steve M Miller Bin Qiu Bin Wang Tina Yang |
| Institution: | 1. Baldwin Risk Partners School of Risk Management and Insurance, Muma College of Business, University of South Florida, Sarasota, Florida, USA;2. Craig School of Business, Missouri Western State University, St. Joseph, Missouri, USA;3. Department of Finance, College of Business Administration, Marquette University, Milwaukee, Wisconsin, USA;4. Kate Tiedemann School of Business & Finance, Muma College of Business, University of South Florida, St. Petersburg, Florida, USA |
| Abstract: | We propose a conceptual framework to illustrate that when three conditions hold, institutional investors moderate a positive relation between corporate financial performance and corporate environmental performance. We explore heterogeneities across institution types to demonstrate the importance of each condition. The moderating effect works through the channels of expert consulting and effective monitoring. Our results have important policy and practical implications given the global trend of ownership concentration in institutional investors and the projection that by 2025, one out of three dollars under professional management will be invested in corporate social responsibility assets. |
| Keywords: | corporate environmental performance delegated philanthropy theory environmental social and governance institutional investors shareholder theory stakeholder theory |