The Implications of Corporate Social Responsibility for Investors: An Overview and Evaluation of the Existing CSR Literature

Abstract

This paper reviews the most important academic studies on CSR and ESG to show where the current research on this topic is standing. Along these lines we provide our assessment of the CSR literature where appropriate.Key questions of this report are: What are the effects of superior CSR on corporate financial performance? What are the effects that particular aspects of ESG have on the cost of equity or cost of debt for firms? Does CSR make sense from a strategic management perspective? Are financial markets aware of CSR? And if so, what can investors do with those firms that display inferior CSR and ESG standards? These are questions this research paper endeavours to answer while reviewing the most important research studies on CSR and ESG.