Prior Corporate Social Responsibility Research Articles

Vertical Individualism As a Motivating Factor in Perceiving CSR Advertising for East Asian Markets: Korea and China

This study expands the prior corporate social responsibility (CSR) studies in East Asia by demonstrating that vertical individualism, which is a rarely studied dimension for consumers in East Asia, plays an important role in processing CSR ads. Furthermore, based on the generational cohort theory and gender theory in the cultural context, through an online survey design, this study’s findings show that the effect of vertical individualism on consumers’ purchase intention varied across generations in East Asia: Korea (study 1; n = 221; 51% female) and China (study 2; n = 201; 47% female). For consumers in China, regardless of gender, vertical individualism is a crucial factor in triggering a strong purchase intention toward CSR ads among older consumers. However, for consumers in Korea, gender effects were found that females (males) were not sensitive (were sensitive) to the effects of vertical individualism on product evaluations across generations. Theoretical and managerial implications are further discussed.

CSR, monitoring cost and firm performance during COVID-19: balancing organizational legitimacy and agency cost

PurposeCOVID-19 induced uncertainty in the firms’ business transactions, financial markets and product-market competition, causing a severe organizational legitimacy crisis. Using the organizational legitimacy perspective and agency theory, this paper aims to study the relationship between prior corporate social responsibility (CSR) activities, monitoring cost (MC) and firm performance.Design/methodology/approachThis study uses a quarterly panel (16,924 firm-quarter observations from 61 countries for CSR and 53,345 firm-quarter observations from 55 countries for MC) for 14 quarters from January 2018 to June 2021. This study uses panel fixed-effect regression models to estimate the effect of CSR activities and MC (measured as audit fees) on firm performance during the COVID-19 period.FindingsThis study finds a U-shaped relationship between CSR and firm performance. This relationship is strengthened during COVID-19. In contrast, this study finds an inverted U-shaped relationship between firm MC and firm performance. However, this relationship is weakened during the pandemic.Originality/valueThis study contributes to theory and practice on maintaining organizational legitimacy and reducing agency costs during the pandemic. This study shows that firms’ prior legitimacy-gaining practices, such as CSR activities and MC, provide an opportunity to increase firm value. To balance agency costs and legitimacy benefits, firm managers also need to identify the optimal level of CSR activities and MC.

Consumers' moral licensing of firms' CSR transgressions

AbstractDespite corporate social responsibility (CSR) engagement, firms may be implicated in CSR transgressions. Research is equivocal on whether CSR buffers negative consumer responses to subsequent firm transgressions. This research extends the observer moral licensing framework to consumer‐firm contexts and examines under what conditions consumers license transgressions following firms' CSR engagement. Study 1 demonstrates that consumer responses to firm transgressions depend on whether the transgression occurs in the same (vs. different) domain relative to CSR engagement and on transgression ambiguity. Study 2 shows that consumer responses to transgressions are less negative when a firm has (vs. has not) previously engaged in CSR. It replicates a shielding effect of CSR that is contingent on transgression domain relative to prior CSR and transgression ambiguity, and finds that blatant same domain transgressions generate hypocrisy perceptions and mitigate licensing effects. Study 3 further extends the moral licensing framework and shows that firm communication that situates CSR efforts on a continuum (continuous CSR positioning) before a transgression moderates, and insincere firm motive attributions mediate, the detrimental effect of blatant same domain transgressions.

Whether Family-owned Enterprises Affect the Correlation between the Extent of export and the Acquisition of the Third-party Assurance of the Corporate Social Responsibility Reports

Abstract What are the impacts of the extent of export on the corporate social responsibility (CSR) report disclosure and assurance of family firms? This research considers the role of Taiwan’s supply chain around the world and compares family-owned and non-family-owned enterprises to determine if there are differences on whether the firm issue CSR report and acquire the third party assurance in accordance with the extent of export. We utilizes companies listed firms from 2008 to 2019 as the sample. The results show that family-owned enterprises are less likely to issue corporate social responsibility reports and acquire the third-party assurance even if they have high export level. The research contributes to prior CSR report disclosure literature by showing evidence on the type of companies or corporate governance mechanisms that could acquire the assurance service of the third party. Moreover, the economy in Taiwan mainly relies on the massive export. The evidence provided by this study should give valuable implications to the academia, practice and government. Keywords: Family-owned enterprises; corporate social responsibility report; extent of export; third party assurance.

Investigating Configurations of Internal Corporate Social Responsibility for Work–Family Spillover: An Asymmetrical Approach in the Airline Industry

Corporate social responsibility (CSR) and work–family interface have attracted considerable scientific interest; however, their relationship has not been considered yet. Drawing on the conservation of resources (COR) theory, this study fills this gap by examining the relationship between internal CSR and work to family spillover. While most previous CSR studies widely examined the net effect of a single CSR dimension, this study discovers configurations of five different internal CSR dimensions (internal dissemination, compensation, occupational health and safety, training, and legal employment) in explaining positive and negative work to family spillover. Using fuzzy-set qualitative comparative analysis (fsQCA), this study examines a primary database of 136 flight attendants working for Asian airline companies; results reveal that the combination of internal dissemination and compensation creates the most driving power in leading to positive spillover. The absence of internal dissemination, occupational health and safety, and legal employment leads to high negative spillover regardless of the presence of compensation. This study broadens the literature by linking internal CSR to employees’ perceptions of work–family spillover. FsQCA findings also make a methodological contribution to prior CSR research by indicating three configurations that explain positive and negative work–family spillover. Findings provide airline companies with practical guidelines that are useful to enhance positive spillover and reduce negative spillover from work to family domains among their flight attendants.

Dimensions of CSR Disclosures: Are They Converging, Diverging, or Crossverging?

Academics have debated whether corporate social responsibility (CSR) practices are global, regional, or crossverging in nature. Prior CSR literature has primarily focused on single-country and on predominantly developed country samples. Another issue has been the use of aggregate CSR to the neglect of different discrete dimensions of CSR such as environment, employees, anti-corruption, human rights, non-governmental organizations (NGOs), and health, In this paper we test whether these aforementioned aspects of CSR disclosures are converging (global), diverging (regional), or crossverging (hybrid) on a sample of 335 multinational enterprises (MNEs) from 31 countries from three regions of the world: Europe, Anglo-Saxon cluster, and Asia and the emerging markets. Using all six individual components of CSR as dependent variables, MANCOVA procedure indicated that there are regional differences. The overall findings of the study imply that on all six individual dimensions of CSR disclosures the divergence hypothesis was supported.

The Effect of Chief Executive Officer and Board Prior Corporate Social Responsibility Experiences on Their Focal Firm's Corporate Social Responsibility: The Moderating Effect of Chief Executive Officer Overconfidence.

This research aims to examine how the prior experiences of the chief executive officer (CEO) and board influence the focal firm’s Corporate Social Responsibility (CSR) activities. Further, the present study examines how CEO overconfidence influences the diffusion of CSR activities. The authors theorize that overconfident CEOs are influenced more by the corporate strategies they experienced on other boards and less by the corporate strategies experienced by other directors. Through longitudinal analyses of the CSR profiles a sample of S&P 500 companies for the period 2006-2013, the study shows that CEO and board prior CSR experience are positively related to the firm’s current CSR activities. The authors find a significant positive moderating effect of CEO overconfidence on the relationship between CEO prior CSR and the focal firm’s CSR. The theory and results highlight how CEO and board prior CSR exposure may influence the focal firm’s stances toward CSR and that CEO overconfidence may have differential effects on these relationships.

The joint effect of corporate social irresponsibility and social responsibility on consumer outcomes

The questions of when and what consumer outcomes corporate social responsibility (CSR) and corporate social irresponsibility (CSI) would elicit when both are present in the same company remain unclear. This study conducted two between-subjects experiments that explored the independent and interaction effects of CSR/CSI order (CSI first, CSR first, or CSR/CSR at the same time), CSR-CSI domain congruity (congruent or incongruent), and the CSR commitment (high or low) on different consumer reactions. Based on two samples (Study 1 N = 361, Study 2 N = 291) recruited in the United States, the results showed that consumers' negative responses toward the company were stronger when CSI followed CSR than vice versa. Specifically, CSI following CSR triggered consumers’ perceived corporate hypocrisy, which in turn led to negative behavioral intentions. Furthermore, we found that companies face more backlash from consumers if their irresponsible behavior was in the same issue domain (versus different domain) as prior CSR.

The value of expertise: how chief executive officer and board corporate social responsibility expertise enhance the financial effects of firms’ corporate social responsibility initiatives

PurposeIn light of the conflict between scholarly findings supporting corporate social responsibility’s positive impact on corporate financial performance (CFP) versus findings showing negative impact on CFP, the academic literature has reoriented toward determining the contingency conditions that affect the underlying relationships. This paper aims to investigate two potential contingency factors, the chief executive officer’s (CEO) corporate social responsibility (CSR) expertise and board members’ CSR expertise.Design/methodology/approachThis paper uses an unbalanced panel of archival data of 168 firms from the S&P 500 index for the period 2006–2013. The analytic model is estimated using the feasible generalized least squares regression method with heteroscedasticity and panel-specific AR1 autocorrelation.FindingsThe findings reinforce the perspective that CSR positively affects the firm’s financial performance. The authors find that firms realize optimal results from their CSR investments when both the board and the CEO have greater CSR expertise. In other words, both, CEO CSR expertise and board CSR expertise positively impact the CSR–CFP relationship.Research limitations/implicationsThe findings of this study advance the literature in three important areas, namely, the social responsibility–financial responsibility relationship, the governance literature and upper echelons theory. First, the theoretical arguments and the empirical evidence highlight that CSR–CFP relationship is at least partly contingent upon the CEO’s and board members’ CSR expertise. Second, this study introduces two important variables: the CEO and board’s CSR experience as proxies for their CSR expertise. Future researchers may consider decomposing the various components of CSR to study the differential impact of each component on financial performance.Practical implicationsFirst, this study finds that while the CEO CSR expertise may be of value for the firm, such value can only be realized under a capable and effective board that has adequate knowledge in the field of CSR. Second, this study shows that the best-case scenario for firms occurs when both its board members and CEO have had greater prior CSR involvement that contributed to their knowledge inventory and skills. Greater knowledge and skills enhance the quality of the decisions that comprise the firm’s CSR strategy.Originality/valueWhile it seems intuitive that prior CSR knowledge and expertise should lead to more and better CSR initiatives, there are few if any studies that empirically examine the effects of this premise on a firm’s financial performance. To the best of the authors’ knowledge, this study appears to be the first that directly tests the relationship between executives’ CSR experience and firm performance.

Buffering or Aggravating Effect? Examining the Effects of Prior Corporate Social Responsibility on Corporate Social Irresponsibility

Buffering or Aggravating Effect? Examining the Effects of Prior Corporate Social Responsibility on Corporate Social Irresponsibility

Irresponsible Corporate Water Actions – Cognitive Judgments and Reactions by Shareholders

Extant literature suggests that cognitive judgements associated with corporate social irresponsibility (CSiR) are distinct and need to be analyzed separately from corporate social responsibility (CSR). This paper specifically focuses on analyzing impact of corporate irresponsibility, within the scope of water actions. We investigate how shareholders evaluate and react to irresponsible corporate water actions by developing a conceptual model. Our model identifies that stakeholder orientation of current irresponsible action, and also of prior CSR and CSiR performance by firms, affect market reactions. Shareholders interpret irresponsible actions towards secondary stakeholders to carry less effects for firms and remain indifferent to such actions, but react negatively when primary and legal stakeholders are affected. We propose that prior primary CSR/CSiR performance mainly drives positive/negative capability reputation, and prior secondary CSR/CSiR performance mainly drives positive/negative character reputation. We further theorize that positive character reputation of secondary CSR performance stimulates insurance-like benefit against earnings loss following an irresponsible event. On the other hand, capability reputation of primary CSR/CSiR performance stimulates greater effects of expectancy violation/conformity. We conduct an event study on negative water news featuring S&P 500 firms during the years 2005 to 2017, to provide some empirical evidence in support of our conceptual model.

The More You Talk, the More You Win: CSR and Firms’ Ability to Win Public Procurement Contracts

This paper examines the possible link between the corporate social responsibility (CSR) communication efforts of companies and their ability to obtain public procurement contracts by focusing on the study of the business-to-government (B-to-G) market. By exploiting a database with the number of public procurement contracts won by SBF 120 companies in France and a constructed CSR index over the period of 2007-2015, the results obtained showed a striking influence of prior CSR communication on the ability of firms to win more contracts during a given year. Our results also underlined the fact that budget constraints may incline public procurers to not base their choices on a company’s CSR communication.

The Wealth Effect of Corporate Water Actions: How Past Corporate Responsibility and Irresponsibility Influence Stock Market Reactions

Ensuring access to clean water is one of the most important development and health challenges of the twenty-first century. Given the manifold impacts of business activities on water resources, corporate water actions should be of central concern to business ethics researchers. Yet so far we know too little about whether business activities that impact on water resources are noticed or how corporate water actions are valued by a firm’s stakeholders, including by financial markets. In response, we conduct an event study to investigate the shareholder wealth effect of reports of corporate water actions. We explore stock market reactions to water actions by S&P 500 firms from 2005 to 2017, showing that the market reacts positively to reports of responsible water actions and negatively to irresponsible actions. We further explain that these abnormal returns to water actions are associated with a firm’s past performance on ethical issues, arguing that the reputational effects from prior corporate social responsibility and irresponsibility influence market reactions. Our analysis provides evidence that there are diminishing marginal returns to responsible water actions for firms with records of past responsibility and an offsetting effect for those with past irresponsibility. Similarly, we demonstrate an insurance effect that limits punishment for irresponsible water actions for firms with responsible performance records and diminishing negative marginal returns for those already seen to be irresponsible. This study is the first to show that shareholders recognize market value in corporate water actions and are prepared to award or punish firms in stock markets based on their impacts on water.

CSR Implication and Disclosure in Higher Education: Uncovered Points. Results from a Systematic Literature Review and Agenda for Future Research

This research reviews and analyzes prior corporate social responsibility (CSR) studies centered on its implications and disclosure in higher education institutions (HEIs). Nine major databases were analyzed to review research articles from various business, management, higher education, and accounting journals for the period of 2004–2020. We follow the seven-step systematic review guidelines developed by Fink 2019 and we base our review analysis on fifty-eight journal articles. The systematic literature review results show a significant increase in the number of CSR article publications and the extent and trend of disclosure. The majority of prior research was based on questionnaires to evaluate the HEIs curriculum and focus on the CSR implication process. However, HEIs are still lagging behind in CSR implication and disclosure, and with a long way to go to obtain sustainability goals. From the study, several opportunities for future research emerged. This study can be useful for HEIs policymakers and practitioners to access the usefulness of CSR implications and disclosures in HEIs. In addition, this analysis assists scholars to explore in-depth the uncovered points related to CSR in HEIs context. This is the first systematic review of CSR implications and disclosures that comprehensively covers higher education institutions as a sector and presents a reference for academic literature from 2004 to 2020.

Keeping Up With the Joneses: Role of CSR Awards in Incentivizing Non-Winners’ CSR

We attempt to provide a novel antecedent of corporate social responsibility (CSR) by focusing on the role of CSR awards. Specifically, we investigate how competitors’ winning CSR awards incentivize non-winning firms’ CSR as a competitive catch-up. Using a difference-in-differences research design, we find that non-winners improve their CSR after their competitors have won CSR awards. Furthermore, based on the awareness-motivation-capability (AMC) framework from the competitive dynamics literature, we find that the media visibility of award winners, the performance gap of non-winners with award winners, and the prior CSR of non-winners strengthen the CSR competitive catch-up behaviors. Findings from this study contribute to the CSR research by highlighting the spillover effect of CSR awards as a meaningful event in incentivizing non-winning firms’ CSR and extending the AMC framework to explain the contingency factors of competitive catch-up in the context of CSR research.

Who benefits from mandatory CSR? Evidence from the Indian Companies Act 2013

We examine the value impact of mandatory Corporate Social Responsibility (CSR) spending required by the Indian Companies Act of 2013 for large and profitable Indian firms. We find that the external mandate is value decreasing, even after controlling for prior voluntary CSR activity by firms affected by the mandate. We also find that there is systematic crosssectional variation across firms. Firms that are profitable and firms in the Fast Moving Consumer Goods sector that voluntarily engaged in CSR, benefit from CSR. Industrial firms and firms with high capital expenditures are negatively impacted by the mandate. We conclude that a one-size-fits-all approach to CSR is sub-optimal and value decreasing.

Do consumers care about CSR activities of their favorite restaurant brands? Evidence from engagement on social networks

ABSTRACT While prior corporate social responsibility (CSR) research has focused mainly on the positive influences of CSR activities on consumers’ perceptions of and attitudes toward brands with survey and experimental design approaches, the current study examines consumers’ engagement with CSR posts on social media platforms using quantitative content analysis. With emphasis on the restaurant industry, this study was conducted in the Facebook context, aiming to investigate how consumers respond to restaurant companies’ CSR posts. The results of this study indicate that the level of consumer engagement depends on the types of CSR posts – environmental, social, or economic. This study examined whether there are differences in CSR posts between the quick service and casual dining sectors, and whether consumers’ responses differ depending on the nature of the product/service and the type of CSR activities. This study contributes to the CSR and social media literature and provides implications for the restaurant industry.

How Do Stakeholders React if CSR is Mandated?

Integrating stakeholder theory and institutional logics, this study examines the boundary conditions of the impact of corporate social responsibility (CSR) on firm value. CSR can only provide competitive advantage and insurance value to firms when the firms have discretion to perform CSR. This study provides a clear evidence that CSR erodes firm value when the institutions force firms to do CSR. Leveraging a unique mandate that requires certain Indian firms to spend 2% of profits on CSR during 2010-2013, we show that firms that are affected by the mandate and do more CSR suffer a negative return in performance. However, both prior CSR engagement and better financial performance together help the affected firms to buffer from such events. The implications of mandatory CSR and the influence of institutional changes on value of firm strategies are discussed.

An Attributional Model of CSR: Market Reactions to Water Actions in Different Stakeholder Domains

This study integrates attribution and expectancy violation theory to explain market responses to corporate social responsibility (CSR) actions oriented towards primary and secondary stakeholders. We test our model and hypotheses empirically in the context of responsible corporate water actions. We argue that market reactions are affected by two important factors influencing attributions to a CSR action, the stakeholder orientation of the current action and the stakeholder orientation of prior CSR performance, which each shape shareholder beliefs and expectations regarding the firm’s actions. We find the market reaction to a CSR action affecting primary stakeholders is significantly positive given its direct financial and strategic attributions, but it is not significant for actions affecting secondary stakeholders as these involve ethical or altruistic attributions. We further find that expectancy confirmation or violation moderates these stakeholder orientation effects, influencing how shareholders react to CSR actions. Our study is one of the first to explore market reactions to responsible corporate water actions, and apply both attribution and expectancy violation theory to the novel context of market reactions to CSR actions.

Can CSR Disclosure Protect Firm Reputation During Financial Restatements?

We investigate the effectiveness of corporate social responsibility (CSR) disclosure in protecting corporate reputation following financial restatements. As expected under legitimacy theory, firms can signal their legitimacy via nonfinancial disclosure after the negative effects of financial restatements. Our results show that restating firms make substantial improvements to overall CSR disclosure quality by changing their standalone reports to a more conservative tone, increasing readability and report length, even though they strategically disclose less forward-looking and sustainability-related content. Such improvements are more pronounced in restating firms with prior low-quality CSR disclosure. Moreover, restating firms with CSR disclosure have smaller forecast errors than non-CSR disclosers, yet the change in CSR disclosure after restatements does not further improve analyst forecast accuracy. Finally, we find that compared with nondisclosers, restating firms with CSR disclosure suffer smaller firm value losses. Overall, the evidence supports the view that consistent CSR reporting alleviates reputational damage and plays an insurance-like or value protection role during crisis periods.