Corporate Social Responsibility and Financial Constraints: Evidence from Korean Firms

Kwak, Young-Min; Bong, Choi Suk

doi:10.17549/gbfr.2015.20.2.15

Cited by 15 publications

(18 citation statements)

References 25 publications

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“…Ref. [16] arrived at a similar conclusion for the companies where the state is involved in CEO appointment. Ref.…”

Section: Literature Overview and Hypotheses Developmentmentioning

confidence: 66%

“…Among such shortcomings in financial markets could be distinguished the government interventions ( [5,[9][10][11][12]; and the references therein). The degree of hardship related to financing opportunities, in general, depends on a set of firm characteristics, such as size, age, credit rating, export orientation, concentration of ownership, and membership in industry associations, among others ( [13][14][15][16][17]; and the references therein).…”

Section: Literature Overview and Hypotheses Developmentmentioning

confidence: 99%

“…Ref. [16] investigated the influence of internal cash flow, access to external finance, and government connections on the investment rate for the case of the Chinese manufacturing firms. They found that the sensitivity of the investment rate is an adequate indicator of financial constraints.…”

Section: Literature Overview and Hypotheses Developmentmentioning

confidence: 99%

See 2 more Smart Citations

Perception and Drivers of Financial Constraints for the Sustainable Development

et al. 2020

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Financial market imperfections constrain firms’ ability to obtain funds. This is especially true for the former communist bloc countries. However, the restrictions on access to financing and the attitudes of management in these geographies remain overlooked by academic research and represent an important obstacle on the roadmap to sustainable development. The objective of this paper is to fill this gap by analyzing the impact of ownership structure, institutional environment development, and debt market profile on the perception of financial constraints by the representatives of corporate top management from 28 countries of the former communist bloc. Our analysis spans over the period 2002–2013. We apply the probit and Heckman models to investigate nonlinear and multicast effects of the considered factors. We evidence that during the crisis and post-crisis periods, foreign ownership alleviates the restrictions on access to financial resources. We also discuss the role of state ownership. We find that the volume of local currency bond market has a nonlinear U-shape relationship. Our results are useful for policy makers focused on sustainable development of the former communist economies by means of improving access of businesses to financing.

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“…Ref. [16] arrived at a similar conclusion for the companies where the state is involved in CEO appointment. Ref.…”

Section: Literature Overview and Hypotheses Developmentmentioning

confidence: 66%

Section: Literature Overview and Hypotheses Developmentmentioning

confidence: 99%

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Perception and Drivers of Financial Constraints for the Sustainable Development

et al. 2020

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“…Hopkins (2004) defines CSR as ethical and responsible actions taken by a firm to create higher standards for society. Many scholars describe CSR activities as voluntary actions taken by firms to integrate society and shareholders (Brown and Dacin, 1997;Sen and Bhattacharya, 2001;Luo and Bhattacharya, 2006;Kawk and Choi, 2015) and to improve society and the environment as a whole (Mackey et al, 2007). Although there is no agreed-upon definition of CSR, in this study, CSR is defined as voluntary actions taken by firms to support employees, customers, communities, and the environment.…”

Section: B Corporate Social Responsibilitymentioning

confidence: 98%

The Control–Ownership Wedge and Corporate Social Responsibility

Ryu¹,

Chae²,

Cho³

2017

Glob Bus Financ Rev

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We examine the effect of the control-ownership wedge (the difference between voting rights and cash flow rights) in Korean business groups (Chaebols) on corporate social responsibility activities. The results of our analyses show that on corporate social responsibility activities decrease as the control-ownership wedge increases. This result remains consistent when on corporate social responsibility scores are used. This study provides evidence that a greater control-ownership wedge decreases engagement in corporate social responsibility activities in the context of Korean business groups (Chaebols), with their unique ownership structure.

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“…Such international consultations on climate change risks, new domestic policies and changes, and requests for disclosure of climate change information are changing the business environment. In past studies, there has been empirical evidence for the relationship between climate change risk, firm value, and cost of capital (Feldman, Soyka, and Ameer, 1997;Garber and Hammitt, 1998;Wagner, Van Phu, Azomahou, and Wehrmeyer, 2002;Sharfman and Fernando, 2008;Busch and Hoffmann, 2011;Chapple, Clarkson, and Gold, 2013;Chava, 2014;Matsumura, Prakash, and Vera Munoz, 2014;Saka and Oshika, 2014;Plumlee, Brown, Hayes, and Marshall, 2015;Kawk and Choi, 2015;QA, Murni, and Agustiningsih, 2015;Park and Noh, 2017).…”

Section: ⅰ Introductionmentioning

confidence: 99%

Relationship between Climate Change Risk and Cost of Capital

Park¹,

Noh²

2018

Glob Bus Financ Rev

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In recent years, a global consensus has emerged on the importance of climate change risks. Climate change risk is also known to affect investment decision-making processes, such as those related to the issuance of Green Bonds and the use of ESG investment principles. Given this context, we examine whether there is a relationship between the cost of capital and climate change risk, by focusing on companies under the Target Management Scheme in Korea. Companies with high levels of greenhouse gas emissions or energy use are more likely to be exposed to the uncertainty related to future climate change risks. We measure the climate change risks faced by companies using information on greenhouse gas (GHG) emissions and energy consumption of companies that were announced in the Korean GHG Information Center from 2011 to 2015. We use the weighted average cost of capital provided by NICE Credit Information Co. Ltd., as a proxy for cost of capital. We find that companies with higher risk of climate change have higher cost of capital. In addition, we show that there is a significant positive relationship between climate change risks and cost of capital in high climate change risk industries.

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Corporate Social Responsibility and Financial Constraints: Evidence from Korean Firms

Cited by 15 publications

References 25 publications

Perception and Drivers of Financial Constraints for the Sustainable Development

Perception and Drivers of Financial Constraints for the Sustainable Development

The Control–Ownership Wedge and Corporate Social Responsibility

Relationship between Climate Change Risk and Cost of Capital

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