Corporate Social Responsibility Scores Research Articles

The relationship between financial performance, firm size, leverage, and corporate social responsibility: A case study of Accenture Plc

This study examined the relationship between financial performance, firm size, leverage, and Corporate Social Responsibility (CSR) at Accenture Plc. Using a quantitative correlational research design, the research utilized secondary data from Bloomberg (2014-2023) and analyzed the variables through a multiple regression model. Financial performance (measured by Return on Equity), firm size (total revenue), and leverage (debt-to-assets ratio) were the independent variables, while CSR was measured through Environmental, Social, and Governance (ESG) scores. Findings revealed that firm size had a significant positive relationship with CSR, suggesting that larger firms are more likely to engage in CSR activities. However, there was no statistically significant relationship between Return on Equity (ROE) and leverage with CSR scores. These findings aligned with previous research on the impact of firm size on CSR but differed in terms of ROE and leverage's influence on CSR engagement. The study concluded that Accenture's revenue capacity positively influenced its CSR activities, while leverage and financial performance, as measured by ROE, did not have a significant impact. Recommendations were made for policymakers to consider encouraging larger firms to enhance CSR engagement through fiscal incentives.

CSR disclosure, financial performance, and ownership: evidence from China

PurposeThis study investigates the relationship between corporate social responsibility (CSR) disclosure and financial performance (FP), and ascertains whether ownership structure (OS) moderates the CSR disclosure–FP nexus.Design/methodology/approachWe distinctly employed the well-established approach of panel data analysis to examine the comprehensive dataset of Shanghai A-share listed firms from 2008 to 2017 with 20,236-full sample and 4,190-disclosed sample firm-year observations. To test the hypotheses, the study used panel regression analysis. The study used CSR disclosure as an explanatory variable and accounting-based performance measures: return on equity (ROE) and earning per share (EPS) as dependent variables. In addition, we used CSR score to determine the extent of disclosure by each firm and employed matched pair sample analysis to check for the robustness of the earlier obtained results.FindingsThe findings indicate significant positive association among CSR disclosure and CSR score with ROE and EPS. Further, the CSR disclosure–FP nexus is more pronounced when the OS moderates it.Research limitations/implicationsThe results of this study lack generalizability due to its unique setting. A limitation of this paper is that our sample period only covers 2008–2017. Future studies can extend our research to a more recent period to test whether our findings remain valid in other periods.Practical implicationsOur findings suggest stronger CSR disclosure measures to enhance the image of businesses in the eyes of stakeholders. The study findings are consistent and confirm the theoretical basis (stakeholder theory) that Chinese listed firms can be more beneficial from disclosing CSR related information, and they should put more emphasis on the improvement of CSR disclosure.Originality/valueThis research offers empirical evidence that sheds light on the importance of OS as the moderating effect on the nexus of CSR disclosure–FP measures. In doing so, this study’s findings contribute to the literature significantly, along with the regulators and shareholders.

The influence of CSR on cross-border mergers and acquisitions

This paper conducts a comprehensive analysis of Chinese enterprises' cross-border mergers and acquisitions (M&A) events from 2012 to 2022, investigating the influence of corporate social responsibility (CSR) levels on cross-border M&A within the Chinese context. The research reveals that enterprises with higher CSR scores tend to experience lower success rates in cross-border M&A. Both internal and external CSR dimensions exhibit negative impacts on cross-border M&A, with external CSR demonstrating a more pronounced adverse effect. Notably, a history of successful cross-border M&A outcomes significantly enhances the likelihood of smoothly completed future transactions..

Are state-owned enterprises more responsible for carbon neutrality? Evidence from stock market reactions to China’s commitment to carbon neutrality

This study investigates whether state-owned enterprises (SOEs) are more responsible for carbon neutrality in the context of a country that produces the most carbon dioxide. It examines listed firms’ market reactions to carbon neutrality commitment for China that was announced first time on 22 September 2020. Using the event study method and based on 2,792 listed firms, we find that overall market reactions to the carbon neutrality commitment is significantly negative, suggesting that firms are expected to exert genuine efforts towards attaining the national goal of carbon neutrality. Furthermore, our results indicate that SOEs encounter more substantial negative market reactions compared to non-SOEs, indicative of higher expectations placed on them for realizing the carbon neutrality commitment. Further analysis reveals that negative market reactions are particularly pronounced for central SOEs as opposed to local SOEs, as the former are perceived to bear a heavier responsibility in achieving national goals. Additionally, SOEs with higher corporate social responsibility scores experience stronger negative market reactions in comparison to those with lower scores. Further analysis based on a difference-in-differences method and a firm-year sample shows that SOEs reduce firm value and carbon emissions intensity more than non-SOEs after the carbon neutrality commitment. Overall, our study supports the argument that SOEs take more responsibility than non-SOEs in achieving carbon neutrality.

Benchmarking of corporate social responsibility in China

This study explores the underexplored application of benchmarking in Corporate Social Responsibility (CSR) among Chinese A-listed companies from 2010 to 2020. The results reveal a positive relationship between CSR performance and local best practices, indicating benchmarking’s influence on CSR activities. Notably, benefits like increased market value, robust revenue, and heightened analyst attention signify positive market signals, motivating companies to enhance their CSR performance. The impacts on CSR performance varies significantly based on leader companies’ CSR scores, ages, and follower companies’ ownership properties, sizes, and locations. Our findings offer valuable insights into CSR motivations and the performance effects of best practices.

Corporate Social Responsibility, Corporate Financial Performance and the Confounding Effects of Economic Fluctuations

This study aims to explore the relationship between Corporate Social Responsibility (CSR) and corporate financial performance in five different countries: USA, UK, Germany, Japan, and Australia. Data is obtained from studies that measure CSR through various metrics, such as CSR Index, CSR Score, CSR Disclosure, CSR Rating, and CSR Spending, while financial performance is measured using various indicators such as Return on Assets (ROA), Return on Equity (ROE), Net Profit Margin, Tobin's Q, Operating Income, and Market Value. Data analysis was performed using linear regression statistical methods to evaluate the relationship between CSR variables and financial performance. It found that there was a significant positive relationship between CSR and corporate financial performance in all countries studied. Companies that are more active in CSR activities tend to record better financial performance. Variations between countries suggest that local context influences the strength of these relationships. The managerial implication of these findings is that investing in CSR can improve a company's reputation, strengthen its position in the market, and improve long-term financial performance. However, further studies are still needed to understand the factors influencing the relationship between CSR and financial performance across various industry and geographic contexts.

Corporate Social Responsibility and Earnings Management: Evidence from Vietnam

Managers might use corporate social responsibility (CSR) to conceal their misbehaviours. One of these is the implementation of earnings management (EM), which could have serious effects vis-à-vis information disclosed to stakeholders. This study examined the relationship between CSR and EM in Vietnam using the Kinder, Lydenberg, Domini (KLD) scale on five aspects: community, diversity, employees, environment, and products. The results show that in the economic context of Vietnam, for the enterprises in the consumer goods and consumer services industries, those firms with higher CSR scores are more likely to engage in EM. This finding provides additional evidence on the relation between CSR and EM and contributes to streams of studies on earnings and CSR.

Corporate social responsibility and labor investment efficiency: evidence from China

PurposeWe expect to provide a complete theoretical framework and large sample evidence on the impact of corporate social responsibility (CSR) on the efficiency of labor investment. We also hope to provide micro-evidence based on labor investment behavior for the two-sided impact of corporate CSR behavior.Design/methodology/approachThis paper measures labor investment efficiency by estimating the difference between actual and expected net hiring of enterprises. CSR is measured on the basis of the CSR score of Chinese listed companies published by Hexun.com. A regression model is constructed to analyze the relationship between CSR and labor investment efficiency. Possible endogeneity problems are controlled by lagging independent variables, propensity score matching method and difference-in-difference method.FindingsResults show that CSR can improve labor investment efficiency by reducing over-hiring and under-hiring in emerging markets. The existence of the mediating effect of agency cost, information disclosure quality and employment fluctuation confirms that CSR improves labor investment efficiency through two mechanisms of corporate governance and labor market friction. The improvement effect of CSR on labor investment efficiency is more significant in non-state-owned, high CEO shareholding ratio and high-average urban wage enterprises.Originality/valueIn conclusion, our study is an important supplement to the existing research on the factors affecting labor investment efficiency. Our research conclusions will be helpful for enterprises in developing countries or enterprises in labor-intensive industries to improve labor investment inefficiency. The conclusion of the mechanism analysis in this paper provides more complete and reliable microscopic evidence for accurately identifying the specific path of CSR's impact on labor investment efficiency. This paper verifies the positive impact of CSR from the perspective of labor investment efficiency in the context of a developing country, which provides evidence for the theoretical conflicts related to CSR based on the effectiveness of enterprise labor investment decisions.

Walking the Walk: Corporate Social Responsibility and Product Recalls in the Automotive Industry

Purpose: The purpose of this paper is to disentangle a unique way in which corporate social responsibility (CSR) affects firm value in the context of product recalls in the automotive industry.
 Methodology: Using a sample of product recall events in the automotive industry between 2002 and 2018 and controlling for the spread of product recalls across product lines, this study explores the underlying economic channels through which CSR improves investments in quality. For robustness check, self-selection bias is corrected for using a 2SLS approach and alternative measures for product failures and CSR.
 Findings: The authors find that firms with higher CSR scores are associated with a lower frequency of recalls. Moreover, higher CSR scores are associated with a higher likelihood of voluntary recalls, higher product quality, higher capital expenditures, and higher employee productivity.
 Unique Contribution to Theory, Practice, and Policy: This study offers insights to managers, investors, and board members, showing the potential benefits of engaging in CSR activities. This study contributes to the literature on the effect of CSR on different managerial decisions and the factors that affect product recalls. Additionally, the study reveals the connection between CSR and product recalls.

Exploring the multifaced influencing factors of corporate social responsibility in Chinese-listed manufacturing enterprises

Although scholars have conducted research on the corporate social responsibility (CSR) of Chinese firms from different perspectives, there has been no unified conclusion so far. Therefore, identifying the factors that influence CSR in Chinese enterprises is an important topic for further investigation. Does the debt leverage ratio, ownership type, degree of internationalization (DOI), and auditing by the Big Four accounting firms have an impact on CSR? Based on a series of questions, our study aims to explore the influencing factors and relationships of CSR from multiple angles. Using data from 252 Chinese A-share listed enterprises from 2014 to 2019 and the CSR scores from the Hexun.com rating index, we constructed a panel dataset comprising 1,414 firm-year observations. After comparing models, the fixed effects method of panel data is ultimately used for empirical regression. The research results indicate a significant negative correlation between the leverage ratio and CSR. State-owned enterprises (SOEs) outperform non-state-owned enterprises (non-SOEs) in terms of CSR. There is a significant positive correlation between DOI and CSR. However, the contribution of audits by the Big Four accounting firms to CSR in Chinese enterprises is limited. While our study examines many aspects of the elements that affect corporate social responsibility (CSR) in Chinese companies, each firm must consider its circumstances and apply suitable strategies to improve its CSR practices.

De‐politicization and corporate social responsibility: Empirical evidence from China

AbstractGiven the lack of consensus in the existing studies about the impact of political resources on corporate social responsibility (CSR), we delve into this relationship and analyze the underlying mechanisms. To address the endogenous problems associated with political connection, this paper explores the consequence of de‐politicization and adopts an exogenous event in China. Results indicate that de‐politicization significantly enhances the CSR performance of firms. Specifically, de‐politicization can lead to a 1.474 increase in CSR scores. This finding is further supported by various robustness tests. Additionally, this paper probes into the reasons for the positive influence focusing on prerequisite and driving forces. For one thing, de‐politicization reduces the rent‐seeking expenses of politically connected firms, thereby granting these firms enough financial resources to improve their CSR performance. For another thing, CSR practices can convey positive information, improve financial performance, and enhance competitiveness, which motivates firms to actively participate in CSR issues to alleviate the adverse influence of losing political connection. This paper enriches the existing research on political connections and provides theoretical guidance and policy recommendations for improving CSR in developing countries.

Corporate social responsibility and bank value: evidence from bank capital

PurposeThis study aims to examine the effect of corporate social responsibility (CSR) on banks’ capital, value and risk by investigating its impact on capital inflows and asset quality. The authors aim to investigate the value-protective characteristics of socially responsible performance.Design/methodology/approachThis study uses a two-stage least squares approach with instrumental variables, with bank and year fixed effects to address concerns regarding endogeneity, specifically reverse causality and unobservable factors.FindingsThe results confirm a positive association of CSR with capital adequacy, including higher quality Tier 1 Capital. The authors find strong evidence that banks with higher CSR scores are associated with greater bank value and lower risk. The extended analyses find that the improvement in capital is from annual growth in capital and lower risky assets.Originality/valueThe research advances the field by providing new empirical evidence of a positive association between CSR and capital, including high-quality Tier 1 Capital. This study complements the prior research by simultaneously examining the dynamic links between CSR and capital, bank risk and bank value. The findings are consistent with the view that there is a dynamic link in which CSR affects the operations of banks.

Managerial myopia and corporate social responsibility：Evidence from the textual analysis of Chinese earnings communication conferences

Corporate social responsibility (CSR) plays an important role in developing countries achieving sustainable goals. Using the textual analysis of Chinese earnings communication conferences, we investigate whether the managers' time horizons influence CSR performance. We find that the level of managerial myopia is negatively related to CSR scores. This deleterious impact manifests asymmetrically under diverse expectations. Furthermore, guided by the CSR pyramid theory, our findings suggest that managerial myopia undermines both financial and legal responsibilities, subsequently exerting an influence on the commitment to social responsibility. Compensation incentives can effectively mitigate the deleterious impacts associated with myopia. Nevertheless, heightened external pressures originating from capital and product markets may impose constraints on managers' time horizons, thereby amplifying the adverse repercussions of myopia.

The Effect of Accounting Conservatism On Corporate Social Responsibility: Evidence from the Corporate Governance Index in Türkiye.

The purpose of this study is to measure whether the companies listed in the BIST Corporate Governance Index have conservative accounting policies and examine the impact of this conservatism on Corporate Social Responsibility (CSR) and its components. Panel data analysis was used in the study. The results mean that companies listed on the BIST Corporate Governance Index prioritize conservative accounting policies and apply them in their financial reports. Additionally, it has been determined that accounting conservatism has a positive impact on companies' CSR scores and their components, with a stronger influence on board of directors scores and stakeholder scores. This finding suggests that companies with conservative accounting policies prioritize the interests of internal management while also valuing external stakeholders.

Manager Characteristics, Corporate Social Responsibility and Brand Value

This article uses the corporate social responsibility score released by Runling Global to conduct a regression analysis on the relationship between fulfilling social responsibility and enhancing brand value of China's 500 companies, as published by the World Brand Laboratory. The proportion of female managers and the proportion of managers with overseas experience are selected from the characteristics of managers as moderating variables to study the moderating effect of moderating variables on the relationship between corporate social responsibility and brand value enhancement. Research has found that fulfilling social responsibility by enterprises has a significant positive impact on brand value enhancement,state owned enterprises fulfilling social responsibility have a significant impact on brand value enhancement, while non-state-owned enterprises fulfilling social responsibility have no significant impact on brand value enhancement;the proportion of female managers in management has a significant positive moderating effect on the relationship between corporate social responsibility and brand value,in state-owned enterprises, the proportion of women in managers has a positive moderating effect on the impact of corporate social responsibility on brand value , in non-state-owned enterprises, this moderating effect is not obvious; managers with overseas experience have a significant positive moderating effect on the relationship between corporate social responsibility and brand value, the moderating effect of managers having overseas experience is significant in non-state-owned enterprises, but not significant in state-owned enterprises.

CORPORATE SOCIAL RESPONSIBILITY AND MARKET-BASED PERFORMANCE: EXPLORING BI-DIRECTIONAL RELATIONSHIP IN AN EMERGING ECONOMY

Corporate Social Responsibility (CSR) is a critical indicator for bridging corporately responsible behavior and stakeholder inclusion towards achieving long-term development. While stakeholder and reputation-building theories suggest that CSR can affect organizational performance, slack resource theory proposes organizational performance can affect CSR. Accordingly, it indicates that CSR initiatives and firm performance have a bidirectional relationship. Despite many unidirectional studies conducted to examine CSR and firm performance interplay in diverse contexts, studies on bidirectional analyses to test contrasting theoretical standpoints in a single study are rare. However, examining the bi-directional role of CSR is crucial as it provides insights into using CSR as a strategic investment decision within the competitive organizational context. Therefore, this study aims to examine the relationship between CSR and market-based performance as a bidirectional study from an emerging country perspective. Study data was collected from the sustainability/CSR disclosures in annual reports published between 2011 and 2020 by the top hundred companies (identified based on market capitalization) listed on the Colombo Stock Exchange (CSE) in Sri Lanka using judgmental sampling. The CSR was measured using a weighted CSR score assessed based on a comprehensive CSR index with thirty sub-dimensions. Market-based performance was measured using earnings per share (EPS) and firm value, and the control variables were firm size and leverage. The data was analyzed in two phases to examine the two-way linkage between CSR and market-based performance using the fixed effect panel regression technique. The findings concluded that CSR positively impacts market-based performance, confirming the role of CSR as a strategic driver to enhance future profitability. However, the study could not find any bidirectional impact of market-based performance on CSR in an emerging context. Although higher CSR affects higher external performance, higher market-based performance does not affect increased CSR in Sri Lanka. It may be because external performance indicators represent only the future profitability of firms, and these indicators are generally highly volatile over a long period, especially in emerging countries like Sri Lanka.

Geographic location and corporate social responsibility: urban versus non-urban firms

ABSTRACT This paper examines whether and how firm headquarters location affects corporate social responsibility (CSR) performance. Utilizing a propensity-score matched sample, we find that comparing to their urban counterparts, non-urban firms are less likely to spend resources on CSR programmes while exhibit a similar degree of socially irresponsible behaviour, resulting in a lower overall CSR score. Further analysis indicates that the availability of financial resources, public monitoring, and social capital mediate the relationship between firm location and CSR performance. Our research adds to the debate on CSR impetus by lending support to the economic incentive of CSR engagement and provides evidence of the social impact of location of corporate headquarters.

The Impact of Corporate Social Responsibility on Corporate Financial Performance --An Empirical Study of Chinese Energy Firms

As the impacts of environmental pollution and climate change on humanity have become increasingly severe, achieving sustainable development has heightened global concerns in recent years. An increasing number of companies have recognized the importance of corporate social responsibility (CSR) and are actively investing in enhancing their performance. Moreover, an increasing number of investors are considering social factors when making investment decisions. Although the potential impact of CSR on corporate financial performance (CFP) is a growing interest in related research filed, there still needs to be consensus on their relationship. This study seeks to address this gap in the context of the Chinese energy sector. By conducting fixed effect panel regression on the CSR scores, accounting financial indicators, and fundamental panel data of 876 listed companies in the Chinese energy sector over the past decade, this paper reveals a nonlinear positive impact of CSR on CFP. Further threshold regression is applied to identify distinct threshold values that affect different financial indicators. The findings of this paper complement the existing related research and provide valuable support and guidance for companies in the energy sector to undertake social responsibility and engage in social responsibility investments effectively.

Does institutional ownership affect corporate social responsibility? Evidence from China

This paper assesses the correlation between institutional ownership and corporate social responsibility (CSR). Our results indicate that institutional ownership is positively associated with firms' CSR scores, which is largely driven by pressure-resistant institutions rather than pressure-sensitive institutions. Moreover, we find that the positive association is stronger for firms with state-owned, poorer initial CSR performance, and located in regions with a higher level of marketization. Further analyses imply that the beneficial effect on CSR scores has a smaller with an increase in institutional ownership concentration, whereas the strength of corporate governance can alleviate the damaging influence of institutional ownership on CSR performance. Finally, we identify two potential mechanisms through which institutional ownership affects CSR projects: Financial constraints and analyst attention.

The Independence of Judges and Corporate Social Responsibility

Limited research has focused on the influence of judge independence on firms' corporate social responsibility (CSR), despite extensive literature examining the impact of the legal environment on CSR. To address this gap, we analyze the staggered adoption of judicial delocalization reform in China. This reform aimed to enhance local judges' independence and our analysis shows that firms have exhibited higher CSR scores since its implementation. Our channel analysis reveals an increase in lawsuits and monetary claims against firms due to the reform, indicating that firms engage in CSR activities to mitigate the negative effects of legal proceedings. The impact of the reform on CSR is stronger for high-litigation-risk firms and weaker for politically connected firms. Moreover, the positive relationship between the reform and CSR is more pronounced in regions with higher levels of government interference with judges before the reform. In summary, our findings highlight the important role of a supportive legal environment in fostering CSR, emphasizing the influence of judge independence.