Corporate Social Responsibility and Stock Prices After the Financial Crisis: The Role of Strategic CSR Activities
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- Published: 15 September 2021
- Volume 182 , pages 223–242, ( 2023 )
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- Aneta Havlinova 1 &
- Jiri Kukacka ORCID: orcid.org/0000-0001-8680-2896 1 , 2
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We analyze the relationship between corporate social responsibility and the stock market performance in the post-global financial crisis period. A new measure of social responsibility by Thomson Reuters, called the ESG Combined Score, is used. As a novel feature of our analysis, socially responsible engagement is divided into the strategic activities closely related to the examined companies’ core business and the remaining secondary activities. The results of the fixed effects regression show a positive and statistically, as well as economically, significant impact of the strategic activities on the corporate stock market performance of companies. This impact is up to 103% higher compared to the secondary activities. The empirical results suggest that if companies aim to increase their share prices via the corporate social responsibility channel, they should strategically select their socially responsible initiatives.
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Data availability.
The data that support the findings of this study are available from the Refinitiv Eikon database (Thomson Reuters, 2021 , accessed 2021-01-28). Restrictions apply to the availability of these data, which were used under license for this study. Data are available at https://eikon.thomsonreuters.com with the permission of Thomson Reuters.
Please note that due to the logarithmic nature of the dependent variable, the precise interpretation of the estimated coefficient of the non-logaritmized independent variable follows: an increase of the independent variable by 1 (small) unit is associated with a change of the dependent variable by \(\big (exp({\widehat{\beta }})-1\big ) \times 100\) percent. This is often approximated by \({\widehat{\beta }} \times 100\) percent. However, such simplification holds well only for ‘very small’ values of \({\widehat{\beta }}\) .
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Acknowledgements
Jiri Kukacka gratefully acknowledges financial support from the Charles University PRIMUS program [project PRIMUS/19/HUM/17] and from the Charles University UNCE program [project UNCE/HUM/035]. We are also indebted to I. Jupa and M. Walter for their professional consultation. Finally, we are very thankful to the two anonymous reviewers for their inspiring comments and detailed suggestions.
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Appendix A: Multicollinearity Assessment: Correlations
Descriptive statistics of the dataset: Correlations
Appendix B: Regression Results Con’t
Appendix c: regression results for the strategic and secondary csr con’t, rights and permissions.
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Havlinova, A., Kukacka, J. Corporate Social Responsibility and Stock Prices After the Financial Crisis: The Role of Strategic CSR Activities. J Bus Ethics 182 , 223–242 (2023). https://doi.org/10.1007/s10551-021-04935-9
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Received : 20 May 2020
Accepted : 26 August 2021
Published : 15 September 2021
Issue Date : January 2023
DOI : https://doi.org/10.1007/s10551-021-04935-9
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1 INTRODUCTION. Since Bowen's first work, the relationship between corporate social responsibility (CSR) and financial performance in the business context has become a topic of significant relevance.The idea and perception of CSR change from company to company, between managers, and in different societies (Lau, Hulpke, To and Kelly, 2007).However, a common aspect exists: instead of companies ...
This paper aims to investigate the literature on Corporate Social Responsibility (CSR) to provide a comprehensive overview of whether CSR would make a difference to organisational financial ...
2. Corporate social responsibility. CSR has been studied for some time now, but a consensus is still missing concerning its definition and its constituent dimensions, constructs and principles (Crane et al., Citation 2008). In a comprehensive literature review, Dahlsrud (Citation 2008) identified 37 different definitions of CSR.There is great variation in these CSR perceptions and definitions.
This literature review includes 54 meta-analyses on CSR and states that the majority of quantitative CSR research concentrates on the CSR-financial performance-link. In line with the business case for CSR, board independence, board gender diversity and board size as key corporate governance factors have a positive impact on CSR performance.
This study aims to present a literature review of recent studies on the relationship between environmental, social and governance (ESG) performance, corporate social responsibility (CSR) and ...
Substantial number of studies have been conducted to explore the relationship between CSR and financial performance. However, no conclusive results have been reported. This paper attempts to explore present literature review and adopts bibliometric analysis to depict the literature review in quantitatively structured manner.
This study aims to present a literature review of recent studies on the relationship between environmental, social and governance (ESG) performance, corporate social responsibility (CSR) and corporate financial performance (CFP) and to provide a path for future researches. Using content analysis method, a total of 88 papers published in ...
1. Introduction. Corporate Social Responsibility (CSR) is considered a progressively indispensable research area for scholars in management; it has also become an essential part of higher education (Ruiz-Lozano & Nieto, Citation 2016; Wigmore-Alvarez et al., Citation 2020).The existing literature examines CSR's concept in various aspects to found the effect of firms' CSR activities.
Han, Kim, and Yu (2016) examine the relationship between corporate social responsibility and corporate profit by testing the ESG performance score on the financial performance of firms listed in the Korean stock market between 2008 and 2014. The study's findings reveal no statistically significant evidence or a relationship between CSR ...
The mission to establish the impact of Corporate Social Responsibility (CSR) on a firm's performance in the literature has been the focus of many past research studies (Orlitzky et al., 2003; Waddock & Graves, 1997).Exploring and analyzing the effect of corporations being socially responsible on their performance have been explained using various theoretical and conceptual underpinnings.
2.1. Corporate social responsibility and firms performance. The review of the literature suggests that there are two major theoretical approaches which explain the association between corporate social responsibility (CSR) and financial performance of the firms.
This paper investigates the influence of corporate social responsibility on firm performance by integrating simultaneously the moderating effects of the firm size and its industry profile. To conduct our study, we use annual environmental, social and governance (ESG) data on 407 European firms listed in STOXX Europe 600 Index during the period 2002-2018. Results reveal that the moderating ...
Despite scads research on the relationship between corporate social responsibility and financial performance, literature is still inconclusive. ... Review of literature. ... This school asserts that CSR is an important driver of enhancing financial performance. CSR, according to stakeholders and agency theory, exerts a positive influence on ...
To shed new light on this issue, we mapped this topic via a systematic review and content analysis of 53 articles identified in the confluence between CSR and financial performance from 1984 to 2021. Our study suggests that CSR directly impacts a company's financial performance, and this impact becomes more significant as the company's ...
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the nature, intensity, and direction of the relationship between CSR and financial performance. This study aimed to answer the following research question: What is the relationship between CSR and com-panies' financial performance? To this end, we conducted a system-atic literature review using the Web of Science database, followed
2. Corporate social responsibility CSR has been studied for some time now, but a consensus is still missing concerning its definition and its constituent dimensions, constructs and principles (Crane et al., 2008). In a comprehensive literature review, Dahlsrud (2008) identified 37 different definitions of CSR.
We analyze the relationship between corporate social responsibility and the stock market performance in the post-global financial crisis period. A new measure of social responsibility by Thomson Reuters, called the ESG Combined Score, is used. As a novel feature of our analysis, socially responsible engagement is divided into the strategic activities closely related to the examined companies ...
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The paper offers a comprehensive analysis of ten studies covering different facets of the application of artificial intelligence (AI) techniques for identifying financial performance. The financial stability of organizations is a major concern for decision-makers, particularly in the finance field. Diagnosing financial problems in the early stages can prevent further complications. Many of the ...