Abstract
This paper explores the impact of corporate social responsibility (CSR) on default risk in various institutional contexts. Using CSR scores and credit ratings for 1,153 firms from 45 countries, we find that CSR reduces the firm default risk level and that the effect is stronger in civil law countries, particularly German and Scandinavian law countries, than in common law countries. The environment component of CSR appears to have the highest impact on default risk. The results, which may prove useful to firms in their fight for survival, are robust using various measures and classifications.
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