Corporate Social Responsibility Value Research Articles

The effects of crisis type and CSR fit on organizational outcomes: The moderating role of authentic leadership in shaping organizational reputation, word-of-mouth, and purchase intentions

This study investigates how crisis type (moral-harm vs. product-harm) and the alignment between an organization's goals and its corporate social responsibility (CSR) values (CSR fit) influence crisis outcomes like organizational reputation, the spread of negative word-of-mouth, and purchase intentions. Additionally, the research examines whether authentic leadership (AL) moderates the relationship between crisis type, CSR fit, and crisis outcomes. Using a 2 (crisis type: moral-harm vs. product-harm) x 2 (CSR fit: high fit vs. low fit) between-subjects design (N = 427) recruited through CloudResearch, the results suggest that product-harm crises have more damaging effects on organizations than moral-harm crises. Also, organizations that align their CSR activities with their business goals receive favorable ratings during a crisis than those with low CSR fit. Lastly, AL moderates the relationship between crisis type and negative word-of-mouth as well as organizational reputation. Theoretical and practical implications of the current study are discussed.

The Nexus Between Corporate Governance, CSR, and Firm Value: Tax Avoidance as an Intervening Variable

This research investigates the role of tax avoidance in the relationship between corporate governance, firm value, and corporate social responsibility. The research design is explanatory research, through hypothesis testing. 175 manufacturing companies were observed from 2017 to 2021, with a sample size of 875. A panel regression and leverage acted as a control variable using SPSS software, after conducting models and robustness tests. The findings show the influence of tax avoidance on institutional ownership and economic corporate social responsibility (CSR). Tax avoidance partially mediates the relationship between institutional ownership and firm value, and fully mediates between economic CSR and firm value. The implication for academics and practitioners is that enabling corporate governance requires institutional owners to supervise the determination of company managerial policies. Additionally, the economic CSR program can reduce tax avoidance and is responded to positively by investors. The limitations of the research are that for the constant value to be significant, additional variables should be added to the model. Further research could include adding company performance, gender, and intellectual capital variables. Keywords: corporate governance, corporate responsibility, tax avoidance, leverage, firm value

Terrorist Attacks, Corporate Social Responsibility, and Firm Value

Synopsis Research problem According to the World Economic Forum, terrorism is one of the main managerial concerns for companies worldwide. However, there is surprisingly scant research on how terrorist attacks impact managerial decision-making. To fill this gap, we investigate how terrorist attacks influence firms’ socially oriented activities, as measured by their investments in corporate social responsibility (CSR). Motivation or theoretical reasoning In light of the crucial role of CSR in financial markets and the growing apprehension regarding terrorism risk, this study explores whether and to what extent firms’ CSR investments contribute to the resilience to terrorism risk. The motivation for our research question is grounded in the idea that terrorist attacks create a unique set of circumstances that prompt firms to reconsider their socially oriented initiatives. We argue that firms impacted by such events tend to recognize the importance of demonstrating commitment to social responsibility in the aftermath of a crisis. Overall, the theoretical underpinnings of this study revolve around the notion that CSR becomes a strategic response for firms affected by terrorism, through which they address various stakeholder concerns, maintain legitimacy, and strategically manage their public image in the aftermath of a crisis. The test hypotheses We empirically examine two key research questions in this study. First, we examine the effect of terrorist attacks on the CSR investments of publicly traded firms. Second, we examine whether and how the increase in CSR investments of publicly traded firms after terrorist attacks affects firm value. Target population Our study extends the limited research on the impact of terrorism on capital markets, which is an area of great concern to various stakeholders, including shareholders and corporate managers. The findings will also help researchers understand the determinants of CSR and the potential channels through which CSR creates value for shareholders. Adopted methodology Using a multivariate regression model and controlling for all other determinants of corporate CSR investment documented by prior studies, we test the effect of terrorist events on firms’ CSR investment. To reduce the concern that a growing awareness of the importance of CSR may explain the changes in firms’ investment in CSR over time, we use a difference-in-differences research design. Analyses Using a sample of 53 major terrorist attacks occurring in the U.S. between 1994 and 2015, this study examines the causal effect of terrorist attacks on firms’ CSR activities. Findings Our findings indicate that public firms located in close proximity to terrorist attacks (i.e., the impact firms) substantially increase their investment in CSR following those terrorist events, and that the increase in CSR investment is positively associated with firm value. We further observe a strengthened association between increased CSR and firm value when the CSR efforts of the impact firms attract greater media attention. In conclusion, our findings substantiate the hypothesis that firms exposed to higher levels of terrorism risk are more inclined to enhance their CSR investments. This inclination is driven by the dual impact of CSR efforts: not only do they contribute to bolstering stakeholders’ confidence in firms’ future performance, but they are also linked to increased returns in the aftermath of a terrorist attack.

The Interplay of Corporate Social Responsibility, Innovation Capability, Organizational Learning, and Sustainable Value Creation: Does Stakeholder Engagement Matter?

At the crossroads of innovation and responsibility, our study delves into CSR’s pivotal role in steering organizations toward sustainable value creation. Combining the frameworks of stakeholder theory, the resource-based view, and dynamic capabilities theory, this study examines the influence of corporate social responsibility (CSR) in enhancing sustainable value creation (SVC), with a keen focus on how organizational learning (OL) and innovation capability (IC) mediate this relationship and the degree to which stakeholder engagement (SE) moderates the impact of CSR on OL, IC, and SVC. Using a quantitative research approach, 416 managers in the Turkish manufacturing sector (e.g., textiles, building materials, and food processing firms) were surveyed using electronic and physical questionnaires. To test the research model, AMOS 24 was employed. The results confirmed that CSR positively influences SVC, OL, and IC; OL and IC positively influence SVC; OL and IC partially mediate the relationship between CSR and SVC. Likewise, the findings suggest that stakeholder engagement (SE) plays a moderate role in strengthening the relationship between CSR and organizational learning (OL), CSR and innovation capability (IC), and CSR and sustainable value creation (SVC), with increased SE enhancing the positive effect of CSR on OL, IC, and SVC. This study explains the complex ways that CSR enhances SVC, focusing on OL and IC’s mediating roles and SE’s moderating effects. It offers manufacturing sectors in Turkey useful information for promoting sustainability and innovation.

Leadership Styles and Corporate Social Responsibility: A Case Study of the Construction Industry in Bangkok, Thailand

This study examines the influence of various leadership styles on Corporate Social Responsibility (CSR) within Bangkok's rapidly growing construction industry. The researchers surveyed 859 individuals through site administration from 1,278 construction sites. Utilizing Structural Equation Modeling to analyze data from construction companies, the study found a correlation between transformational and ethical leadership styles and the successful implementation of CSR initiatives. The study emphasizes how vital organizational culture and employee engagement are in strengthening the connection between leadership and corporate social responsibility. The findings underscore the positive impact on employee engagement when leaders involve them in decision-making. By promoting higher engagement, companies can improve their CSR efforts. Transformational leadership significantly impacts positive results by establishing a clear vision that aligns with corporate social responsibility values. Highlighting the significance of ethical leadership, it becomes evident that adhering to moral principles in leadership can significantly contribute to a strong emphasis on CSR. To achieve a crucial outcome, it is advised that construction firms emphasize fostering transformational and ethical qualities in their leadership development programs. In addition, implementing participative strategies can significantly improve corporate social responsibility practices. This research provides a valuable framework for companies seeking to improve their CSR efforts and offers insights for policymakers interested in promoting sustainable development in the industry.

Corporate social responsibility and firm value: exploring the moderating effects of information technology-enabled knowledge capabilities

PurposeA substantial amount of research has examined the firm value impact of corporate social responsibility (CSR). Nevertheless, the findings have been inconsistent, prompting researchers to identify contingencies under which the impact varies. This study examines how information technology (IT)-enabled knowledge capabilities moderate the relationship between CSR and firm value.Design/methodology/approachWe conducted the ordinary least squares (OLS) regression analysis on a sample of S&P 500 companies spanning from 2010 to 2017. We employed additional methods to test the robustness of the results, including the generalized method of moments (GMM) estimator and the two-stage least squares (2SLS) method.FindingsThe results show that IT-enabled absorptive capability (IT-AC) and IT-enabled social integration capability (IT-SIC) positively moderate the CSR–value relationship. Further, their moderating effects vary in distinct ways when environmental dynamism changes, hinting at the distinct underlying rationales behind the moderating roles of IT-AC and IT-SIC.Research limitations/implicationsThis study improves the understanding of the business value of CSR and IT. It has limitations in generalizability due to the use of secondary data.Practical implicationsThis study provides practical guidelines to managers about how to strategically leverage IT resources for the creation of CSR value.Social implicationsEncouraging businesses to enhance their CSR efforts and uphold sustainability extends beyond our immediate benefit and impacts future generations as well. However, due to an imbalance between costs and returns, companies often refrain from being wholeheartedly devoted to CSR. Our insights on guiding companies to derive more value from CSR can inspire their greater investment in CSR. Meanwhile, companies can obtain additional returns from deployed IT.Originality/valueThis study extends the IT business value literature by revealing how IT generates firm value in the context of CSR. It also adds critical insights into the mixed findings in previous research regarding the CSR–firm value link. The study’s findings offer useful guidance on the strategic deployment and utilization of IT resources to facilitate the creation of CSR value.

CONTRIBUTION OF CORPORATE SOCIAL RESPONSIBILITY AS A MEDIATOR IN FIRM VALUE

This research investigates the impact of Environmental, Social, Governance (ESG) and Corporate Social Responsibility (CSR) factors on the value of transportation companies listed on the Indonesia Stock Exchange. ESG and CSR have become increasingly important for businesses as stakeholders demand sustainable and socially responsible practices. The objective of this study is to comprehend how ESG and CSR affect firm value, with CSR acting as a mediator in this relationship. Additionally, the study explores the influence of Good Corporate Governance (GCG) on firm value and CSR. Quantitative methods are employed, utilizing secondary data analysis from annual reports of transportation companies listed on the Indonesia Stock Exchange. Regression techniques are used to analyze the data and test hypotheses regarding the influence of ESG, CSR, and GCG on firm value. The results indicate that ESG has a negative impact on firm value, while CSR has a positive impact. Furthermore, CSR acts as a mediator between ESG and firm value. Conversely, GCG does not significantly influence CSR or firm value. These findings suggest that transportation companies should prioritize CSR practices to enhance their firm value. Additionally, further research is needed to gain a deeper understanding of the relationship between CSR, firm value, and sustainability.

The value of corporate social responsibility: evidence from the humidifier disinfectant scandal in Korea

ABSTRACT As a quasi-natural experiment, we examine the effects of corporate social responsibility (CSR) on firms’ stock performance amid a corporate scandal closely linked with environmental and social (ES) issues, the humidifier disinfectant scandal in Korea. We find that firms with higher ES ratings, especially those with higher social ratings, outperform firms with lower ES ratings during the product safety scandal. Our estimation shows that one standard deviation increase in a firm’s ES score translates into about 2.4% higher stock returns during the scandal period. Our findings reveal that ES performance is influential over a firm’s stock returns when investors pay high attention to CSR, suggesting that firms’ CSR investments mitigate their nonfinancial risk.

Internal and external communication in oil & gas for enhancing CSR implementation: A review

Effective communication is essential for the successful implementation of Corporate Social Responsibility (CSR) initiatives in the oil and gas sector. This review examines the role of internal and external communication in enhancing CSR implementation in the industry. Internal communication focuses on engaging employees and stakeholders within the organization, while external communication involves interactions with external stakeholders, including communities, governments, and NGOs. The review finds that internal communication plays a crucial role in fostering a culture of CSR within oil and gas companies. By effectively communicating CSR goals, initiatives, and progress to employees, companies can increase employee engagement and commitment to CSR objectives. Internal communication also helps ensure that CSR values are integrated into organizational practices and decision-making processes. External communication is equally important for enhancing CSR implementation in the oil and gas sector. By engaging with external stakeholders, companies can build trust, enhance their reputation, and gain valuable insights into community needs and expectations. Effective external communication also helps companies demonstrate transparency and accountability in their CSR efforts, which is critical for maintaining a social license to operate. Overall, the review highlights the importance of integrating internal and external communication strategies into CSR implementation in the oil and gas sector. By fostering a culture of CSR internally and engaging with external stakeholders effectively, companies can enhance the impact of their CSR initiatives and contribute to sustainable development in the communities where they operate.

Impact of target firm’s social performance on acquisition premiums

This study investigates whether a target firm’s corporate social responsibility (CSR) influences the acquisition premium paid by an acquirer. Using the US public mergers and acquisitions (M&A) deals, this study finds that acquisition premium increases as targets’ perceived CSR quality increases, an effect incremental to previously documented drivers of such premiums. Additional findings reveal that the positive association between targets’ CSR quality and acquisition premiums is stronger for large targets and acquirers with high CSR performance. The study also documents that targets’ environmental performance has the strongest effects on acquisition premiums compared to other dimensions of CSR such as community, employees, diversity, or product. This study contributes to the literature by documenting the value of CSR in an unconventional manner using evidence from the M&A market. The findings are robust after controlling for the target-specific, acquirer-specific, deal-specific, and macro-economic variables and by using different proxies for CSR and acquisition premiums.

Pengaruh Good Corporate Governance (GCG) dan Corporate Social Responsibility (CSR) terhadap Nilai Perusahaan dengan Profitabilitas sebagai Variabel Moderasi

This research aims to evaluate the influence of Good Corporate Governance (GCG) and CSR on Company Value, with Profitability as a moderating variable. Quantitative methodology is used with data on shares of state-owned companies on the Indonesian Stock Exchange in the 2017-2021 period. Research participants involved shares of state-owned companies, and data was collected from the Indonesia Stock Exchange website, and analyzed using smart PLS4 software. The research results show that profitability has a moderating effect on managerial ownership, independent board of commissioners, and CSR on company value. The conclusion is that the management of BUMN subsidiary companies can take further steps to maximize the use of managerial ownership, strengthen the role of the independent board of commissioners, and develop corporate social responsibility (CSR). This becomes more important in facing rapid developments in science, information technology and increasingly fierce global business competition. This research is original with a focus on the correlation between GCG, CSR and company value, considering profitability as a moderating variable. Keywords: CSR, GCG, Company Value, SEM

Corporate social responsibility in the new normal era: review

A business theory known as "corporate social responsibility" (CSR) places an emphasis on an organization's social and ethical responsibilities in addition to maximizing profits. It entails incorporating social responsibility, moral decision-making, and sustainable practices into the foundation of corporate operations. CSR essentially seeks to strike a balance between financial performance and a favorable influence on the environment and society, demonstrating a dedication to ethical business practices and stakeholder well-being. Businesses are realizing the value of corporate social responsibility (CSR) in the face of changing global issues in the "new normal" period. Corporate Social Responsibility (CSR) becomes more important in the new normal era as companies deal with previously unheard-of difficulties. Global events have brought about a paradigm change that requires robust and socially responsible corporate strategies. CSR provides businesses with a strategic framework to meet demands in society, gain the trust of stakeholders, and adjust to shifting expectations. It fosters long-term sustainability in a constantly changing global landscape by positioning firms as responsible contributors to community and environmental well-being, in addition to aligning them with ethical imperatives. A critical analysis of corporate social responsibility (CSR) in the new normal age reveals a dynamic business environment where companies adjust their approaches to meet changing needs. Important discoveries highlight how crucial CSR is to boosting long-term sustainability, stakeholder trust, and resilience. The literature emphasizes the value of moral behavior, environmental stewardship, and social contributions while highlighting successful CSR implementations during global upheavals. All things considered, the assessment shows how important corporate social responsibility (CSR) is in helping companies become not just financially sustainable but also socially and environmentally conscious in the face of enormous shifts.

The Influence of Corporate Social Responsibility on Company Value with Profitability as a Oderation Variable in Registered Manufacturing Companies on the Indonesian Stock Exchange Period 2019-2021

This research aims to determine the influence of CSR (Corporate Social Responsibility) on company value in manufacturing companies listed on the Indonesia Stock Exchange for the 2019-2021 period. The sample used in this research was purposive sampling, totaling 56 companies with 3 years of observation and obtained from the annual financial reports of manufacturing and component companies at www.idx.co.id. The data analysis used is SPSS version 25 analysis. The results of the research show that CSR (Corporate Social Responsibility) has a significant positive effect on company value and profitability as proxied by ROA (Return On Assets) and moderates the relationship between CSR and Company Value.

Does managerial ability matter in corporate sustainability-related dynamics? An empirical investigation

This study aims to assess the intricate interplays between managerial ability, corporate social responsibility (CSR), and firm value, focusing on 3,498 company-year observations sourced from the RANKINS CSR RATINGS and China Stock Market & Accounting Research (CSMAR) databases representing China’s Shanghai and Shenzhen A-share listed companies from 2009 to 2018. Employing a rigorous sample selection process and utilizing data from reliable databases, the research employs a comprehensive methodology to explore the intricate corporate sustainability-related dynamics influencing organizational success and societal impact.The findings reveal a compelling negative correlation between managerial ability and CSR performance, corroborating previous research and suggesting potential challenges in reconciling managerial competence with social responsibility priorities. Furthermore, this paper establishes a negative correlation between CSR and firm value, with managerial ability influencing the magnitude of this impact, underscoring the significance of managerial skills in moderating the relationship between CSR initiatives and overall corporate performance. Moreover, the study uncovers a robust positive correlation between managerial ability and firm value, emphasizing the pivotal role of adept leadership in achieving higher corporate valuation. It provides valuable insights for practitioners, policymakers, and scholars, creating a conducive environment for well-informed decision-making. In the ever-changing corporate landscape, a deep understanding of these interconnections is essential to nurture business practices that are both sustainable and value-oriented. AcknowledgmentThis paper is co-funded by the European Union through the European Education and Culture Executive Agency (EACEA) within the project “Embracing EU corporate social responsibility: challenges and opportunities of business-society bonds transformation in Ukraine” – 101094100 — EECORE – ERASMUS-JMO-2022-HEI-TCH-RSCH-UA-IBA/ERASMUS-JMO-2022-HEI-TCHRSCH https://eecore.snau.edu.ua/Oleh PASKO expresses sincere gratitude for the support from the Kirkland Research Program, generously provided by the Leaders of Change Foundation established by the Polish-American Freedom Foundation.

A bibliometric analysis: Corporate social responsibility and firm value

This literature review was conducted in the form of a bibliometric analysis (Zupic & Čater, 2015) to examine the trends and findings of studies on corporate social responsibility (CSR) and firm value. There were 269 Scopus-indexed publications published between 2007 and 2023 analyzed in this study, then processed with R Biblioshiny to generate and visualize the citation matrix and bibliometric network. VOSviewer and additional analysis were also undertaken. The trend of publications on CSR and business value has significantly increased every year, especially in 2022, where 54 publications were made, hitting an annual publication growth rate of 10.58 percent. The results of the review revealed the USA as the most influential nation, and the Journal of Business Ethics as the journal with the strongest influence. An article with 989 citations was published in the Management Science journal written by Lee S., making it the most influential article. Based on the co-occurrence network, the intensity of research on the relationship between CSR and firm value has increased between 2017 and 2021. Jo H. appeared as the most frequently cited author in this field based on co-citation and the USA and Canada were the top two countries in terms of collaboration among countries. This study provides useful insights for future CSR and business value studies. This research is very important for researchers studying CSR and firm value literature. In particular, the findings allow new researchers to quickly identify the theoretical underpinnings, as the leading researchers and documents identified in this study provide an entry point for new researchers.

Corporate social responsibility obscuration strategy: The ineffectiveness of social accounting in CSR implementation

This study aims to explore the obscuration of corporate social responsibility (CSR) practices carried out by companies and their impacts on the ineffectiveness of social accounting. Three problems were investigated in this study, including 1) what is the motive behind the CSR practice, 2) how is the CSR obscuration pattern, and 3) how the CSR obscuration impacts the effectiveness of social accounting. This study was conducted on 28 companies that were members of the mining industries going public on the Indonesia Stock Exchange in 2021. To analyze the data, content analysis and taxonomy methods were employed. The results showcased an obscuration of CSR practices from their original goals. The obscuration of CSR could be seen from the motives underlying the CSR implementation, which prioritized economic motives rather than social motives. The five patterns of CSR obscuration comprised 1) motive shifting, 2) meeting the litigation, 3) emphasis on specific CSR implementation, 4) internal stakeholder orientation and support for company operations, and 5) being wrapped or entrusted with company promotion. As a result of the CSR obscuration, it impacted 1) the ineffectiveness of social accounting and 2) the shift in the CSR value from its original purposes.

The Effect of Concentrated Ownership on Tax Avoidance: CSR Mediates or Moderates

This study seeks to empirically demonstrate the relationship between concentrated ownership and tax avoidance, exploring the potential role of Corporate Social Responsibility (CSR) as either a mediating or moderating variable. From the aim of this research, the formulation of the problem in this research is whether concentrated ownership has an effect on tax avoidance and this research wants to further prove whether CSR is more appropriate to use as a mediating or moderating variable in explaining the relationship between concentrated ownership and tax avoidance. The research focuses on a selection of manufacturing firms that uphold CSR values during the period from 2019 to 2021, employing purposive sampling as the method for sample selection. Concentrated ownership is defined as ownership exceeding 50%, while tax avoidance is measured using the Effective Tax Rate (ETR). The results prove that concentrated ownership encourages management to conduct tax avoidance as an effort to obtain additional capital for the firm's investment needs so that companies tend to shift current taxes to future taxes. This research proves the existence of agency problems where concentrated ownership expropriates minority interests. CSR functions as a moderating factor in the correlation between concentrated ownership and tax avoidance. It serves to diminish managerial endeavors in evading taxes by establishing corporate legitimacy. With better implementation of CSR, it is hoped that this will not be a motivation for companies to avoid taxes when companies are dominated by concentrated ownership and investors prefer to invest in companies that have concentrated shares.

Do pressure-sensitive institutional investors moderate CSR decisions towards value creation of Indian firms?

Purpose Research on the significance of corporate social responsibility (CSR) and value creation is nascent as compared to CSR and financial performance. The concept of value is also evolving because of changing business environments, globalization and the expanded idea of CSR. Nowadays, managers expect a more quick, pragmatic approach to satisfy valid stakeholder claims while simultaneously creating competitive advantage through reputation and investor value. The paper aims to examine the impact of CSR on the market and sustainable value creation through CSR expenditure in India and the moderating role of pressure-sensitive institutional investors (PSII). Design/methodology/approach The study used panel data regression methodology on a sample of 1,845 non-financial Indian firms from 2015 to 2021. Findings CSR creates market and sustainable value for non-financial Indian firms in line with stakeholder theory. The authors find a positive moderating role of governance represented by PSII on CSR and market value creation but not on sustainable value. Research limitations/implications The study is based on secondary data. CSR, despite being a regulatory obligation, provided long-term benefits that increased their sustainable growth rate. The results highlight the importance given by financial markets to CSR activities. Other types of institutional investors can also be examined in future research. CSR can be embedded in the core operations of the firm, which can help in fostering a culture of sustainability and responsible business practices that benefit firms and society as a whole. Tax incentives can be provided to firms investing in CSR. Practical implications CSR provides long-term benefits to the firm, which enhances the goodwill and integrity of the firm in the market. The results reveal that besides capital market investors, firms are subject to the scrutiny of consumers, communities and the government as expectations rise and information spreads faster, which can have repercussions. CSR helps in meeting such expectations and the perceived value of the firms. Managers and chief executive officers (CEOs) can pay attention to the type of institutional investors like PSII, which can be formed as a part of the firm’s CSR strategy. Social implications The positive impact of CSR on sustainable value expresses a long-term management orientation based on the improvement of stakeholder relations and the associated environmental impacts referring to cohesion and consensus, market opportunities and strengthened reputation and image. A sustainable company involves a conscious and continuing effort in the equilibrium between contrasting stakeholders’ expectations in an attempt to optimize value creation. Tax exemption can be provided for CSR activities. Originality/value The authors contribute to the scant literature on CSR and value creation, especially sustainable value, as most of the prior studies are not empirical on sustainable value in the Indian context. Managers and CEOs can pay attention to the types of institutional investors like PSII, which can be formed as a part of the firm’s strategy.

Revisiting the nexus between corporate social responsibility and corporate value: Evidence from China

AbstractPurposeUnder the concept of sustainable development guided by ‘carbon peak’ and ‘carbon neutral’, corporate social responsibility (CSR) performance has become the focus of attention in all sectors of society. With the gradual deepening of China's ‘new economic normal’ development, firms face increasing environmental uncertainty in the market. This study aims to embed CSR, financial flexibility (FF), institutional investors (INST), and corporate value into the same theoretical framework and conduct heterogeneity analysis on the nature of property rights, heavily polluting industries, and marketisation level.Design/Methodology/ApproachBased upon the observation data of listed firms in Shanghai and Shenzhen A‐shares in China from 2011 to 2021, this study uses Stata software for data processing, analysis, and two‐stage least‐squares (2SLS) models to solve endogenous problems.FindingsThe research results show that improving CSR performance increases corporate value, while INST and FF moderate the relationship between them. Further heterogeneity analysis found that the nature of property rights, heavily polluting industries, and marketisation level have different impacts on these moderating effects. This result provides ideas for clarifying the economic impact of enhancing the firms' CSR performance in the current era.Originality/ValueFirst, from the standpoint of CSR performance, it enhances the literature on the key corporate values in China. Second, from the perspective of corporate value, it has enriched the CSR literature and provided a new perspective for further clarifying the significance of improving the CSR performance of firms at this stage. Third, from the perspective of INST and FF, this research examines the moderating mechanism of CSR performance on corporate value. Hence, it provides a reference for further improving the efficiency of resource allocation in the capital markets.

The effect of corporate governance, corporate social responsibility and information asymmetry on the value of Indonesian-listed firms

Purpose This study aims to examine the influence of corporate governance (CG) and corporate social responsibility (CSR) on firm value while accounting for the impact of information asymmetry. Design/methodology/approach This empirical analysis is based on 1,079 observations from 83 listed Indonesian firms for the period 2007–2019. The authors applied simultaneous equation models with ordinary least squares and two-stage least squares. Findings The authors present empirical evidence of CG mechanisms that significantly contribute to low levels of CSR. Moreover, the authors identify a significant impact of information asymmetry on the relationship between CG, CSR and firm value. Research limitations/implications The results show that information asymmetry, CG and CSR do not necessarily result in improved firm value across boards. Moreover, the employment of a nonlinear Cobb–Douglas-type function indicated diminishing marginal returns. Practical implications The findings can help policymakers in developing countries in improving the monitoring and supervisory roles of CG mechanisms to provide more support to CSR, increasing regulatory pressures for improved CSR performance and reducing information asymmetry by adopting a standardized CSR reporting scheme. Social implications The suggested implications can contribute to more sustainable practices among Indonesian-listed firms as well as improving relationships with consumers and stakeholders toward the practice of CSR. Originality/value The adoption of a comprehensive CSR measurement tool to examine the value of CSR contributes to the extant literature, along with examining the impact of information asymmetry on the relationship between CG, CSR and firm value in a developing country context.