Corporate Social Responsibility and Long-term Compensation: Evidence from Canada

Mahoney, Lois S.; Thorne, Linda

doi:10.1007/s10551-004-5367-z

Cited by 237 publications

(143 citation statements)

References 39 publications

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“…More specifically, prior literature has reported a significant relationship between CSR and incentive-based compensation (Falck and Heblich 2007;Mahoney and Thorne 2005). Also, Jones et al (2007), in their case study involving Australian companies, found that the extent to which a firm is involved in CSR was directly correlated to its adopting a performance-based wage system.…”

Section: Hypothesesmentioning

confidence: 95%

Good Neighbors but Bad Employers: Two Faces of Corporate Social Responsibility Programs

Jung

Kim

2015

J Bus Ethics

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Using two firm-level datasets in Korea, we analyzed the effects of corporate social responsibility (CSR) on employment relations. We propose that participation in corporate social activity may not necessarily reflect an ethical commitment to do ''the right thing,'' but instead can be associated with mobilizing internal resources to offset the costs imposed by external CSR involvement undertaken because of social pressure. Analysis of the two datasets showed similar results. The results demonstrate that socially responsible actions facilitate employer tendency to use performance-based pay and efficiency-based work practices. We also find that CSR has a negative association with employment growth and increased labor flexibility through contingent employment. These findings shed light on the internal impact of CSR involvement on a firm's employment policies with respect to resource allocation.

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Section: Hypothesesmentioning

confidence: 95%

Good Neighbors but Bad Employers: Two Faces of Corporate Social Responsibility Programs

Jung

Kim

2015

J Bus Ethics

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“…Previous research, which has looked at the relationship between executive compensation and CSR (Frye et al, 2006;Mahoney and Thorne, 2005;McGuire et al 2003), has mainly focused on CEO's flow compensation. The arguments shared by this stream of research rely on the fact that CSR may lead the company to forgo short-term profits to invest in projects that have no immediate payoff.…”

Section: Background and Motivationmentioning

confidence: 99%

“…In recent years there has been an increasing interest in CSR, which has led to wide press coverage and a growing number of academic research papers on the topic (Mahoney and Thorne 2005). As pointed out by Porter and Kramer (2006, p. 78), governments, activists and the media have become adept at holding companies to account for the social consequences of their activities and many organizations have started ranking companies on their CSR performance, attracting considerable publicity.…”

Section: Introductionmentioning

confidence: 99%

The Role of CEO’s Personal Incentives in Driving Corporate Social Responsibility

2013

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In this study we explore the role of Chief Executive Officers' (CEOs') incentives, split between monetary (based on both bonus compensation and changes in the value of the CEO's portfolio of stocks and options) and non-monetary (career concerns, incoming/departing CEOs, power and entrenchment) in relation to corporate social responsibility (CSR). We base our analysis on a sample of 597 US firms over the period [2005][2006][2007][2008][2009]. We find that both monetary and non-monetary incentives have an effect on CSR decisions. Specifically, monetary incentives designed to align the CEO's and shareholders' interests have a negative effect on CSR and non-monetary incentives have a positive effect on CSR. The study has important implications for the design of executive remuneration (compensation) plans, as we show that there are many levers that can affect CEO's decisions with regard to CSR. Our evidence also confirms the prominent role of the CEO in relation to CSR decisions, whilst also recognizing the complexity of factors affecting CSR. Finally, we propose a research design that takes into account endogeneity issues arising when examining compensation variables.

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“…Only salary and long-term incentives are found to be statistically significant in the social weaknesses model. With a similar research design, Mahoney and Thorne (2005) provide evidence that only some elements of compensation matter to certain measures of sustainability.…”

Section: Linking Sustainability To Compensation: Emerging Practices Amentioning

confidence: 99%

Sustainable Bonuses: Sign of Corporate Responsibility or Window Dressing?

2013

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Corporate Social Responsibility and Long-term Compensation: Evidence from Canada

Abstract: This paper examines the association between long-term compensation and corporate social responsibility (CSR) for 90 publicly traded Canadian firms. Social responsibility is considered to include concerns for social factors and the environment (e.g.

Cited by 237 publications

References 39 publications

Good Neighbors but Bad Employers: Two Faces of Corporate Social Responsibility Programs

Good Neighbors but Bad Employers: Two Faces of Corporate Social Responsibility Programs

The Role of CEO’s Personal Incentives in Driving Corporate Social Responsibility

Sustainable Bonuses: Sign of Corporate Responsibility or Window Dressing?

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