Corporate socially responsible investments: CEO altruism, reputation, and shareholder interests

Borghesi, Richard; Houston, Joel F.; Naranjo, Andy

doi:10.1016/j.jcorpfin.2014.03.008

Cited by 642 publications

(411 citation statements)

References 36 publications

Supporting

Mentioning

366

Contrasting

Unclassified

Order By: Relevance

“…For example, Petrenko and his associates (2015) demonstrated that chief executive officers (CEOs) more exposed in the media, hence, presumably, more narcissistic and more arrogant, are likely to allocate more resources to the projects designed to raise their firm's CSR profiles. Overall, this line of research further suggests that firms' CSR efforts are, at least in part, driven by such instrumental or strategic motivations of individual TMT members, as they desire for more external attention, better reputational standing and higher labor market value [34][35][36].…”

Section: Theory and Hypothesesmentioning

confidence: 91%

“…One stream of research focuses primarily on individuals belonging to the so-called top management team (TMT), arguing that firm-level differences in CSR endeavors are attributed to differences in certain characteristics of those individuals [34][35][36]. In particular, researchers contended that psychological traits of high-level officers affect companies' involvement in CSR-enhancing practices.…”

Section: Theory and Hypothesesmentioning

confidence: 99%

See 1 more Smart Citation

Women on Boards and Corporate Social Responsibility

et al. 2016

View full text Add to dashboard Cite

A growing body of research suggests that having more women in the boardroom leads to better corporate social responsibility (CSR) performance. However, much of this work views the CSR-enhancing effect of women directors as largely driven by their moral orientations and rarely considers other underlying mechanisms. Moreover, less explored are the firm-specific conditions under which such CSR-promoting roles of female directors might be performed more (or less) effectively. In this paper, we seek to bridge this gap in the literature by (1) proposing an additional account for the positive influence of female independent directors on the firm's CSR and (2) illuminating the organizational context in which female directorship is likely to translate into good CSR performance. We argue that women independent directors might take CSR issues more seriously than their male counterparts not only because of their stronger moral orientations, but also because they have reputational reasons to do so. Further, we suggest that female directors' concerns about CSR-relevant matters are more (less) likely to gain support from other members of the organization when their company is doing more (less) business in the product markets where reputation for CSR is more (less) vital for success. Using a sample of Standard & Poor's (S&P) 1500 index firms (2000)(2001)(2002)(2003)(2004)(2005)(2006)(2007)(2008)(2009) and the data on their board composition and CSR ratings, we find strong support for our argument. We find that the number (or proportion) of women independent directors is positively associated with a firm's CSR ratings and that the strength of this relationship depends on the level of the firm's consumer market orientation.

show abstract

Section: Theory and Hypothesesmentioning

confidence: 91%

Section: Theory and Hypothesesmentioning

confidence: 99%

Women on Boards and Corporate Social Responsibility

et al. 2016

View full text Add to dashboard Cite

show abstract

“…For instance, studies showed that certain psychological and socio-economic traits of high-ranking corporate officers tend to affect the CSR performance of their firms. This stream of work notes that the level of CSR efforts by firms is partly determined by the moral orientations of the individuals in influential positions [18][19][20]. More interestingly, some researchers suggested that the desires of the upper-echelon members of firms for more public attention, a better reputation, and higher labor market value are also important drivers behind their firms' pursuit of CSR initiatives [20,21].…”

Section: Theory and Hypothesesmentioning

confidence: 99%

“…This stream of work notes that the level of CSR efforts by firms is partly determined by the moral orientations of the individuals in influential positions [18][19][20]. More interestingly, some researchers suggested that the desires of the upper-echelon members of firms for more public attention, a better reputation, and higher labor market value are also important drivers behind their firms' pursuit of CSR initiatives [20,21]. While this line of work focuses on the attributes of individual firm decision-makers as an explanation for the CSR performance of firms, others moved their attention up to group-level features of the key decision-making body within firms.…”

Section: Theory and Hypothesesmentioning

confidence: 99%

How Third-Party CSR Evaluation Matters: Keeping Up with Rivals in CSR Performance Ratings of Korean Firms, 2011–2015

Hyun

2017

Sustainability

View full text Add to dashboard Cite

Does corporate social responsibility (CSR) evaluation by third-party entities (i.e., external agencies, including civic organizations) affect the CSR performance of firms? This article explores the question of whether and how third-party CSR ratings change the subsequent CSR behavior and hence performance of rated firms. Combining insights from the research on ratings/rankings and a behavioral theory of firms, we hypothesize that firms with large negative CSR rating gaps-i.e., CSR ratings below the industry average-are more prone to improving their subsequent CSR behavior, and hence performance ratings, than those with small negative gaps, because of the desire to avoid being viewed as CSR laggards relative to their industry rivals. As a result, efforts are directed at enhancing CSR performance. Empirical support for this conjecture is found through random effect regression analyses of publicly listed firms in Korea that were rated by the KEJI (Korean Economic Justice Institute) during 2011-2015 with respect to multiple dimensions of CSR. Further results show that the positive effect of negative CSR rating gaps on subsequent CSR ratings appears only in the firms without well-established reputations, suggesting the possibility that firms with weak reputations have stronger incentives to keep up with other industry incumbents in CSR performance ratings than their counterparts.

show abstract

“…US evidence highlights either weak (Barnea and Rubin, 2010) or negative (Borghesi et al, 2014) institutional holding effects. Dam and Scholtens' (2012) European market analysis also reveals limited association.…”

mentioning

confidence: 99%

The role of board gender and foreign ownership in the CSR performance of Chinese listed firms

McGuinness

Vieito

Wang

2017

Journal of Corporate Finance

693

473

View full text Add to dashboard Cite

China's recent promotion of Corporate Social Responsibility (CSR) has coincided with a marked increase in the number of Chinese listed firms attracting female board members and foreign equity investors. Using Rankins' (RKS) ratings over the 2009 to 2013 period, we show that greater gender balance in top-management supports stronger CSR performance. This finding broadens gender-based accounts emphasizing social networks (Westphal and Milton, 2000), Critical Mass Theory (Kramer et al., 2006;Bear et al., 2010;and Soares et al., 2011) and team dynamics (Woolley et al., 2010;and Hoogendoorn et al., 2013). Findings also reveal stronger CSR performance in firms with a female CEO. Female leadership thus appears to be just as important as gender mix in driving CSR change.CSR ratings are also increasing in foreign ownership levels. We examine whether a political-networking motivation underlies foreign investment (Du and Girma, 2010;Liu et al., 2014a;Lin et al., 2015;and Jiang and Kim, 2015). We argue that qualified foreign institutional investors (QFIIs) deploy socialengagement in non-SOEs to build competitive advantage. But in SOEs, where strong political networks already exist, QFIIs have less incentive to boost CSR ratings. However, results indicate little difference in the social ratings of QFII-invested SOEs and non-SOEs.Additionally, we confirm the Barnea and Rubin (2010) contention of an inversion in social ratings at entrenched managerial ownership levels. Non-linear rating effects also emerge in relation to state ownership (Li et al., 2013). Finally, CSR performance exhibits positive (negative) relation with a listed entity's size and age (leverage and lagged return-on-equity) but virtually no connection with independent board representation.

show abstract

Corporate socially responsible investments: CEO altruism, reputation, and shareholder interests

Cited by 642 publications

References 36 publications

Women on Boards and Corporate Social Responsibility

Women on Boards and Corporate Social Responsibility

How Third-Party CSR Evaluation Matters: Keeping Up with Rivals in CSR Performance Ratings of Korean Firms, 2011–2015

The role of board gender and foreign ownership in the CSR performance of Chinese listed firms

Contact Info

Product

Resources

About