Effects of Corporate Social Responsibility Disclosure on Brand Value: An analysis of Interbrand Companies

Natalia Aversano,Giuseppe Sannino,Giovanni Zampone

doi:10.5539/ijbm.v16n6p17

Abstract

The paper aims at investigating how CSR (Corporate Social Responsibility) and ESG (Environmental, Social and Governance) disclosure affect the brand value of a sample of Interbrand companies. Empirically results show that the brand value is positively related to the environmental disclosure, social disclosure, and ESG disclosure, whereas no significant correlation has been found for the governance disclosure. This study provides new evidence to the growing body of literature that identifies CSR as a means of improving the company&rsquo;s brand value and can represent a starting point in the discussion on the reputational benefits of CSR practices.

Highlights

In the last decades, Corporate Social Responsibility (CSR) has become increasingly widespread among large and mid-cap companies worldwide
Under the Legitimacy Theory (LT), companies engage in CSR activities and disclosure as a result of a normative pressure; in other words, CSR activities is a legitimacy instrument used by companies to be seen acting within the bounds of what is considered acceptable according to the expectations of stakeholders on how their operations should be conducted (Guthrie & Parker, 1989; Owen, 2008)
Under the Resource-Based View (RBV), companies believe that CSR activities and disclosure increase the corporate reputation (Branco & Rodrigues, 2008) and help to build a positive image with stakeholders; in turn, these factors positively affect the economic results of the company

Summary

Introduction

Corporate Social Responsibility (CSR) has become increasingly widespread among large and mid-cap companies worldwide. According to KPMG (2017), 93% of the world’s 250 largest companies by revenue (based on the Fortune 500 ranking) issues CSR reports This growing trend has been widely analyzed by literature, which has proposed several explanations for a company's CSR practices. The present paper embraces the RBV theory According to this perspective, resources are typically assets or capabilities (Wernerfelt, 1984) that possess certain special characteristics: they are valuable, rare, inimitable, and non-substitutable (Barney, 1991). Resources are typically assets or capabilities (Wernerfelt, 1984) that possess certain special characteristics: they are valuable, rare, inimitable, and non-substitutable (Barney, 1991) Such resources are typically intangibles and able to generate a sustainable competitive advantage (Amit & Schoemaker, 1993; Michalisin, Smith & Kline, 1997). The CSR practices have a positive impact on brand value and stakeholder engagement

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