Corporate Social Responsibility Value Research Articles

The effects of social responsibility on company value: a real options perspective of Taiwan companies

Corporate social responsibility (CSR) is a subject that has garnered considerable attention in recent years. This study conducts the empirical study by using a real options perspective to examine whether a company’s CSR commitment tends to increase its market value. According to Taiwan’s CommonWealth Magazine, this study distinguishes CSR and non-CSR companies. The paper estimates and compares the real options values of CSR and non-CSR companies and shows that high percentage of the company value is attributed to real options. This study finds that a company’s commitment to fulfilling its social responsibility increases its real options value and that the higher the number of CSR Awards won by a company, the higher its real options value. Compared with 10 years ago, investors now pay more attention to companies’ CSR performance. In addition, the higher a company’s size, systematic risk, fixed asset ratio, debt ratio, or skewness in stock returns, the higher a real options value is likely to be.

A review of Corporate Social Responsibility assessment and reporting techniques in the aviation industry

Problems of developing meaningful Corporate Social Responsibility (CSR) assessment and reporting have been discussed in academic papers since the 1950s. However, questions of understanding the value of CSR, the assessment and reporting techniques used, the methods for rating companies for their contribution to CSR, from both the e organisational and consumer’s points of view, remain open. Different philosophies, the history of business formation, along with issues of organisational culture, gives rise to heterogeneous models and, accordingly, different approaches and techniques for CSR assessment.The purpose of this study is to review the issues of CSR assessment and reporting in the aviation industry. This study provides a brief survey of the recent literature on CSR assessment techniques and raises discussion on the effectiveness of CSR reporting standards in the aviation industry. This study indicates that CSR assessment can be divided into techniques for rating and self-assessment. The article also presents a theoretical basis for the formation of CSR assessment techniques for airlines and airports. The application of Fuzzy Theory to the formation of criteria for the assessment of a company’s CSR activity reporting within the European Union and Eastern European region is discussed. The proposed approach could be used by air transport stakeholders, interested in making investment decisions.

The effect of corporate social responsibility and ownership structure on firm value in food and beverage companies in south east Asia

This study aims to analyze the influence of corporate social responsibility (CSR) and ownership structure towardfirm value. The independent variable thatused in this study are corporate social responsibility (CSR), institutional ownership, managerial ownership and foreign ownership. The dependent variable that used in this study is firm value which measured by Price to Book Value (PBV) ratio. The sample of this study were taken from several food and beverages companies in Shoutheast Asia that registered in www.orbis.bvdinfo.com which published annual report and annual stock data in 2014-2016.A multiple regression analysis with SPSS 22.0 For Windows was used as the technique data analysis. The result of this study explain that corporate social responsibility (CSR), institutional ownership and managerial ownership have influence to firm value, while foreign ownership does not have influence to firm value.

CSR and Firm Value: Evidence from China

This study attempts to investigate the influence of corporate social responsibility (CSR) on firm value. Drawing upon stakeholder theory and a resource-based view, we argue that corporate social responsibility is expected to positively affect firm value because it helps firms gain positive stakeholder responses. Based on longitudinal data of Chinese manufacturing firms listed at Shanghai and Shenzhen Stock Exchange between 2010 and 2015, we use multiple linear regression to find that corporate social responsibility has a positive relationship with firm value and that the relationship between CSR and firm value is weakened for firms with higher advertising intensity, as CSR by these firms gains negative stakeholder responses. State-owned firms were shown to benefit more from CSR, as CSR by these firms gains positive stakeholder responses for such firms.

CSR engagement and values in a pre-emerging and emerging country context

PurposeInternationalization has witnessed rapid growth of multinational enterprises (MNEs) in emerging markets, requiring reflection on how to operate within these markets. The purpose of this paper is to assist MNEs to adapt to these markets, and adopt corporate social responsibility (CSR) strategy with social initiatives (SIs), relevant to stakeholders, including their employees and the communities they reside in. The current paper does this by examining the relationships between employee identification with the organization’s SIs (SI-I) and their engagement in them (SI-E), alongside their perspective on the general importance of CSR (ICSR) and employee values to help with CSR (VCSR). The findings will better prepare managers in pre-emerging and emerging markets to design CSR strategy and SIs relevant to these markets and their communities.Design/methodology/approachGuided by social identity theory, this paper examines local employee identification of SI (SI-I) and engagement in SI (SI-E), in two MNE subsidiaries across varying emerging market levels in developing countries, utilizing a quantitative survey design. Structural equation modeling is utilized to analyze responses of N=544 employees in two South East Asian countries, namely, Indonesia (as an emerging country) and Vietnam (as a pre-emerging country), to determine any differences that may exist between the two countries.FindingsThe findings reveal that SI identification (SI-I) has a strong effect on employee engagement in SIs (SI-E) and also the importance they attach to organizations conducting CSR (ICSR). However, employee values to help with CSR activities (VCSR) has an effect on Vietnamese employees but not Indonesian employees. Likewise, SI-I mediates the effect between ICSR and SI-E for Vietnamese employees but not for Indonesian, suggesting differences exist between these two developing countries where the less developed country, Vietnam, is defined as pre-emerging and Indonesia as an emerging market (MSCI, 2016).Practical implicationsAn awareness of the differences that may exist across employees in emerging markets will assist managers to design CSR strategy relevant to the level of market emergence of the host country, allowing for better CSR SIs identification and engagement in these countries.Originality/valueThe research model for this analysis utilizes constructs based on past Identification literature, while including new constructs for this study adapted from past literature, and underpinned uniquely by social identity theory in an International Business setting. The findings indicate differences between emerging and pre-emerging markets for particular constructs, which suggests the importance of considering the market level when implementing MNE CSR strategy. Limited research has been conducted examining the differences between emerging and pre-emerging markets, so further research is required to replicate these findings and provide insight into the differences that may exist for CSR SIs in emerging markets.

The Influences of CSR’s Multi-Dimensional Characteristics on Firm Value Determination by a Fusion Approach

Corporate social responsibility (CSR) implementation has been widely acknowledged as playing a key part in enhancing firm value as well as achieving sustainable development. However, up to now the extant works in the literature have yielded non-conclusive results regarding the relationships between CSR and firm value. One of the possible reasons is that the studies ignore the multi-dimensional characteristics of CSR—that is, they merely utilize a singular synthesized indicator as a proxy to represent the corporate’s CSR performance as being unreliable and problematic. Thus, this study breaks down CSR into numerous dimensions and further examines each dimension’s impact on firm value. By doing so, managers can allocate their firm’s valuable resources to suitable areas so as to increase its reputation and value. In addition, this research sets up an artificial intelligence (AI)-based fusion model, grounded by fusion learning theory that aims at complementing the error made by a singular model, to examine the relationship between CSR’s multidimensional characteristics and firm value. Through different combinations of adopted strategies, users can realize the most representative features from an over-abundant database.

Valuations and Decisions of Investing in Corporate Social Responsibility: A Real Options Viewpoint

Corporate social responsibility (CSR) implementation could raise corporate reputations and benefit long-term development. Studying the effects of CRS on corporate valuation is essential. However, studies on the valuation of CSR are limited, particularly studies involving a dynamic model for valuing CSR. This study applies a real options approach to derive the company valuation of CSR investments, CSR options value, and the optimal timing for implementing CSR. This study elucidates the value of CSR and the decision to invest in CSR. Specifically, the value of CSR options facilitates determining whether to invest in CSR, and the optimal threshold for implementing CSR indicates explicitly when to invest in CSR. In addition, numerical analyses and results are demonstrated to verify the established model. This is the first and novel attempt to consider the valuation model and optimal strategies of CSR investments using the methods of real options.

The influence of an organisation’s adopted corporate social responsibility constructs on consumers’ intended buying behaviour: a Malaysian perspective

PurposeThe purpose of this study was to examine the influence of adopted corporate social responsibility (CSR) constructs, which include economic, legal, ethical and philanthropic responsibilities, on the intended buying behaviour of Malaysian consumers. The study also aims to investigate the perceived value of whether the consumers considered an organisation’s CSR initiatives before deciding any purchase of products or services.Design/methodology/approachAn online Google form survey successfully obtained 295 usable responses through a snowballing and networking approach. Statistical analyses such as Pearson correlation, ANOVA and standard multiple regression were used to examine the correlation and the strength of relationship, as well as the prediction between the CSR attributes and their impact on consumer buying behaviour.FindingsThe results represented a significant positive association between all the four constructs (social, ethical, legal and philanthropic) and consumer intended buying behaviour. These constructs also significantly contributed to the prediction of consumer behaviour towards the CSR initiatives. Conversely, the demographic profile of consumers had no effect on the relationship between CSR and consumer buying behaviour.Research limitations/implicationsExamining basic concepts of CSR awareness and understanding might add to the flavour and rigour of this study, which future research should consider. The positivist approach of the current research could be supplemented with a more interactive qualitative in-depth study investigating why and how consumers behave.Practical implicationsThe implication for Malaysian companies is that it is imperative for their long-term survival that a strategic view, rather than just a tactical, reactive or operational view, is taken of their CSR activities. Furthermore, it will help organisations to confidently predict positive intentions towards the sales of goods and services.Originality/valueThe outcome of this study has filled the CSR lacuna in the context of a developing country, as well as adding new insights into the influence and perceived value of CSR on intended consumer buying behaviour. Consumers, irrespective of their age and background, are getting wiser and cautious in purchasing products from companies which are CSR-oriented, in particular, in relation to social, legal, ethical and philanthropic perspectives.

Pengaruh Corporate Social Responsibility Terhadap Nilai Perusahaan dengan Profitabilitas dan Free Cash Flow Sebagai Pemoderasi

Every company will strive to increase the value of the company through increasing the prosperity of the owner or shareholders by improving the company's performance. Increased corporate performance one of which can be done by applying social responsibility (CSR). This study aims to test and obtain empirical evidence of the influence of Corporate Social Responsibility (CSR) on the value of companies with profitability and free cash flow as a moderator. This research was conducted at mining company listed in Bursa Efek Indonesia (BEI) year 2013-2016. Sampling method used is purposive sampling. The number of samples meeting the criteria is 10 companies. Methods of data collection is done by documentation method. Data analysis technique used is Moderated Regression Analysis (MRA). The result of moderation testing between Corporate Social Responsibility and corporate value shows a positive influence which means profitability and free cash flow strengthens the influence of Corporate Social Responsibility towards firm value.
 Keywords: firm value, CSR, profitability, free cash flow

Reversing the lens: Why corporate social responsibility is not community development

AbstractCorporate activities have impacts on different groups across societies, and businesses therefore have different sets of responsibilities to these groups. These are increasingly being addressed through corporate social responsibility (CSR) and corporate community development (CCD) initiatives, and there is now a wide body of literature that highlights the value of CSR for business. However, less attention has been paid to understanding the impacts of these activities from the perspective of communities. This paper “reverses the lens” to explore these community perspectives. We argue that communities see and evaluate CSR/CCD in terms of the broader immanent effects of the corporate presence rather than simply the intentional CSR programs and prioritize relationships over material outcomes. We outline an agenda for corporations that begins with the realization that core business practices can impact profoundly on long‐term community development and that effective contributions require corporations to “embrace chaos” and to develop the types of relationships that foreground community goals and priorities.

Terrorist Attack and Corporate Social Responsibility

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’ corporate social responsibility (CSR) activities. 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 terrorist events, and that the increase in CSR investment is positively associated with firm value. We further observe a strengthened association between the increased CSR and firm value when the CSR efforts of the impact firms are related to greater media attention. Overall, our findings support the conjecture that although firms located in the areas most impacted by terrorist attacks are likely to experience a greater demand for CSR activities, the perceived value of the impact firms’ CSR investments increase because their CSR efforts are likely to gain greater community visibility.

Corporate social responsibility, firm value, and influential institutional ownership

We examine how Corporate Social Responsibility (CSR), jointly with influential institutional ownership (IO), affects firm value around the 2008 global financial crisis. We find that the effect of CSR on firm value varies with the level of influential institutional ownership and depends upon economic conditions. Using difference-in-difference methods, we show that compared with non-CSR firms, CSR firms have higher firm values before the financial crisis but experience more loss in firm value during the crisis. Our findings suggest that the overall CSR effect depends on the relative dominance of two effects: conflict-resolution and overinvestment effect. In addition, we apply triple difference analysis and show that the relation between CSR and firm value depends upon the level of influential institutional ownership. Specifically, before the crisis, CSR positively affects the value of low institutional ownership firms and the effect is significantly weaker for firms with higher influential IO. During the crisis, the CSR-firm value relation is positive for high institutional ownership firms, suggesting that overinvestment concerns dominate when the crisis occurs. However, such a positive IO effect is not significant for CSR firms with high rollover risks. Our results are supported by a series of robustness tests.

Corporate Social Responsibility, Ownership Structure, and Firm Value: Evidence from Korea

This study examines the relationship between corporate social responsibility (CSR) and firm value in the context of ownership structure. Specifically, our study explores whether large shareholder and foreign shareholder ownership play an important role in the CSR–firm value relationship. Using a sample of 48 firms listed on the Korea Stock Exchange (KSE) between 2010 and 2014, we find that CSR is positively associated with firm value. We further find that the relationship between CSR and firm value is weaker in firms with high large shareholder ownership than in firms with low large shareholder ownership. However, we find no evidence of the effect of foreign ownership on the relationship between CSR and firm value. This study sheds light on the importance of ownership structure in the relationship between CSR and firm value, suggesting significant implications for academics, practitioners, and policymakers. We contribute to the existing literature by providing empirical evidence on the effect of ownership structure on the CSR–firm value relationship. Policymakers may consider these results in implementing their policies that can enhance CSR activities.

Peer pressure, CSR spending, and long-term financial performance

ABSTRACTWe investigate the role of peer pressure on banks’ Corporate Social Responsibility (CSR) activities and the long-term impacts of their CSR spending on financial performance. We find that a bank’s CSR expenditure increases with that of its peer-banks. However, there is no association between a bank’s CSR expenditure and that of banks of its non-peer group. Our results are robust to addressing the sample selection and bank-specific omitted variable bias, alternative definition of peer pressure, and addressing the concern of alternative explanation that CSR expenditure is driven by tax incentive. Additional analysis suggests that a bank’s CSR spending increases not only the current profitability but also its future profitability. This study establishes the evidence of the peer pressure on CSR spending, and the value of CSR in terms of short – and long-term benefits.

Do capital markets value corporate social responsibility? Evidence from seasoned equity offerings

Abstract We explore whether firms’ corporate social responsibility (CSR) activities provide added value to capital market participants through seasoned equity offerings (SEOs). SEOs represent cleaner exogenous activity alleviating the reverse causality issue plaguing many prior studies examining the relation between firm performance and CSR. Using a large sample of U.S. SEOs, we find high-CSR issuers experience fewer negative market reactions to SEO announcements. We also show ethical issuers have incentive to provide extensive and informative disclosures, which mitigate the degree of information asymmetry, thereby decreasing SEO underpricing. Among CSR categories, we find issuers engaging in community and environmental CSR activities and improving the rights of women and minorities are more effective at reducing SEO negative announcement returns and underpricing. Our findings remain robust after controlling for possible self-selection bias and endogeneity problems. Overall, our findings support the stakeholder value maximization view of stakeholder theory and ethical theory.

CSR and Shareholder Value in the Restaurant Industry: The Roles of CSR Communication Through Annual Reports

Studies on the effects of corporate social responsibility (CSR) on shareholder value identified that CSR communication through marketing channels is a key mechanism necessary to translate CSR into shareholder value. In this study, annual reports are considered the primary information source used by a firm’s financial stakeholders (e.g., investors and analysts) in their valuation of the firm. Specifically, this study examined whether the extent to which restaurant firms communicate CSR through their annual reports influences the effect of CSR on shareholder value in returns (i.e., Tobin’s Q) and risks (i.e., equity-holder risk). CSR was disaggregated into two distinct types for primary and nonprimary stakeholders. Results corroborate that communicating CSR for nonprimary stakeholders through annual reports helps the nonprimary-stakeholder CSR to increase shareholder value by reducing equity-holder risk, whereas communicating CSR for primary stakeholders does not affect the value relevance of the primary-stakeholder CSR through a change of either Tobin’s Q or equity-holder risk.

Indirect reciprocity and reputation management: Interdisciplinary findings from evolutionary biology and economics

The concept of indirect reciprocity provides a scientific basis for the strategic value of corporate social responsibility within public relations. In contrast to direct reciprocity, indirect reciprocity occurs when an entity other than the recipient rewards a benevolent actor. Drawing primarily upon research from evolutionary biology and economics, this article builds an interdisciplinary case for the reality and efficacy of indirect reciprocity as a strategic means of building reputation and, consequently, establishing relationships that lead to resource acquisition. It concludes with a call for additional, related explorations of disciplines such as psychology, primatology, and neuroscience.

KEBIJAKAN CORPORATE SOCIAL RESPONSIBILITY (CSR) PERTAMBANGAN DAN PENGARUHNYA TERHADAP KESEJAHTERAAN MASYARAKAT (Studi Kasus pada Desa Koeono, Kecamatan Palangga Selatan, Kabupaten Konawe Selatan)

ABSTRACTResearch has been conducted which aims to find out how the Corporate Social Responsibility (CSR) Policy of Mining and Its Influence on Community Welfare in Koeono Village, South Palangga Subdistrict of South Konawe Regency. The data used in this research is qualitative. Determination of the number of samples taken from 110 head of household with an error rate of 5%, so gets 87 respondents. The variables used in this research are CSR fund transfer mechanism, target accuracy, community involvement in CSR program planning implementation, CSR value transparency, transaction cost and monitoring and community welfare.The results of the analysis show that the mining CSR program simultaneously has an influence on the welfare of the community. Partially, however, only CSR fund transfer mechanism variables affect the level of community welfare, while the accuracy of targets, community involvement in the implementation of CSR program planning, CSR value transparency, transaction costs and supervision does not affect the level of community welfare. Based on the determinant coefficient of percentage of influence of CSR policy on mining where CSR fund transfer mechanism, target accuracy, community involvement in CSR program implementation, transparency of CSR value, transaction cost and supervision on community welfare of Koeono Village, South Palangga Subdistrict of South Konawe Regency is 34.4 %, the remaining 65.6% influenced by other variables not examined in this research.

The Information Value of Corporate Social Responsibility

Using a simple cheap-talk game, we theoretically demonstrate that corporate social responsibility (CSR) helps mitigate the CEO-board information asymmetry, leading to more informed advising and monitoring by the board. By optimally engaging in CSR, the board can take advantage of stakeholder information revelation and reduce its informational dependence on the CEO, which enables the shareholders to choose an ex ante higher level of board independence. For a sample of U.S. firms between 1999 and 2013, we find strong support for this strategic complementarity between board independence and the information value of CSR. Our results highlight a novel rationale for CSR – the information motive.

Pengaruh Corporate Social Responsibility , Ukuran Perusahaan, Struktur Modal Dan Tax Avoidance Terhadap Nilai Perusahaan

The purpose of this study is to examine the effect of Corporate Social Responsibility, Corporate Size, Capital Structure and Tax Avoidance on Firm Value simultaneously and partially. Population in this research is manufacturing company which entered in LQ45 at Indonesia Stock Exchange (BEI) period 2011- 2016. The type of data in this study is secondary data with sample selection technique used is purposive sampling with a period of research for six year. Methods of data analysis in this study is multiple regression analysis with a significance Level of 5%. The results showed that simultaneously Corporate Social Responsibility, Company Size, Capital Structure, and Tax Avoidance have a positive and significant effect to Firm Value. Partially, Corporate Social Responsibility has no significant effect on Firm Value, Corporate Size has negative and significant effect to Firm Value, Capital Structure has positive and significant influence to Firm Value, Tax Avoidance has negative and significant effect to Firm Value. Keywords: Corporate Social Responsibility, Company Size, Capital Structure, Tax Avoidance, and Firm Value