Cash holdings and social responsibility dimensions of firm

Abstract

The purpose of this research is to investigate corporate social responsibility and level of cash holdings. The research method is descriptive and correlational. For this purpose, 99 firms were selected from Tehran Stock Exchange through a screening technique for 10 years (2006–2015). Research data by panel are calculated using multivariate regression. In this research, we used Levin, Lin, Chu and Dicky Fuller test to determine the reliability and relaiablity of research variables. For analyzing colinearity of variables, we used variance inflation factor test. The results show that variables are stable and there is no colinearity between them. Then, we determined the most suitable regression model by performing F-lemmer and Hausman's test, and tested the hypotheses through the relevant model. The results of hypothesis testing show that there is a positive and significant correlation between social responsibility and cash holdings. Also, we observed the relationship between components of social responsibility (political and social performance, customer and supplier performance, social investment performance and firm strategy performance) and cash holdings, and there was no significant relationship between employee performance strategy and environmental performance with cash holding.