Does Corporate Social Responsibility (CSR) Create Shareholder Value? Evidence from the Indian Companies Act 2013

Manchiraju, Hariom; Rajgopal, Shivaram

doi:10.1111/1475-679x.12174

Cited by 319 publications

(279 citation statements)

References 74 publications

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“…This is the responsibility of board of directors to ensure spending of 2% of average net profit on approved CSR activities and to disclose CSR policy and initiatives on company's website and in board's report (Manchiraju & Rajgopal, ). Companies can include several CSR activities in their policy, which range from eradication of hunger and poverty to community problem resolution projects.…”

Section: Literature Reviewmentioning

confidence: 99%

Unattended social wants and corporate social responsibility of leading firms: Relationship of intrinsic motivation of volunteering in proposed welfare programs and employee attributes

Hao

Farooq

Zhang

2018

Corp Soc Responsibility Env

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With accelerated amelioration in service standards and expectations of stakeholders, enterprises need to undertake promising efforts for the real contribution to society. This paper is aimed to build a framework for examination of employee‐specific viability of five proposed philanthropic initiatives that can be launched by large corporations. Matchmaking, marriage arrangement, and poverty alleviation through skill development are discussed for new external corporate social responsibility (CSR) programs, and anti‐sexual harassment awareness campaign at the workplace and assistance to low‐paid workers are projected as doable internal CSR initiatives. This article describes the importance of potential CSR activities with chief emphasis on exploring the impact of intrinsic motivation for volunteering of each proposed CSR program on employee's vital work attitudes. Drawing implications to advance the literature, we have developed the hypotheses that have formulated a testable model. On practical front, our work highlights the crucial need to consider implementation of new CSR programs with effective conceptualization of employee motivation and organizational outcomes.

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Section: Literature Reviewmentioning

confidence: 99%

Unattended social wants and corporate social responsibility of leading firms: Relationship of intrinsic motivation of volunteering in proposed welfare programs and employee attributes

Hao

Farooq

Zhang

2018

Corp Soc Responsibility Env

View full text Add to dashboard Cite

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“…For example, based on international evidence, [24] found a consistent positive relationship holds only in the long run and, therefore, short-term stock returns are not related to CSR except for European firms. The authors of [25] found that the firms forced to spend money on CSR activities experience a 4.1% drop in their stock prices. The work [12] found no relationship between CSR and risk-adjusted stock return.…”

Section: Csr and Value Relevance Of Financial Reportingmentioning

confidence: 99%

CSR Performance, Financial Reporting, and Investors’ Perception on Financial Reporting

Timbate

Park

2018

Sustainability

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This study examines whether socially responsible firms behave differently from other firms in their financial reporting. Specifically, we question whether firms that are better in their corporate social responsibility (CSR) performance also behave in a responsible manner to maintain their financial reporting quality and whether the market rewards such responsible behaviors. Using data from S&P 500 US companies, we find that socially responsible firms are less likely to manage their earnings. However, we fail to find significant relationships between CSR and investors' perceptions on earnings, measured by stock returns and earnings response coefficient. We interpret the results as investors not fully reflecting the benefits from CSR performance. Our findings are consistent with the notion that CSR activities are motivated by managers' ethical incentives to serve the interests of stakeholders.

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“…Corporate social responsibility (CSR) reporting represents a form of voluntary corporate non-financial disclosure for managers to signal their trustworthiness and communicate private information to investors. The literature indicates that CSR information has incremental value to investors when evaluating, for example, companies' future financial performance (Orlitzky et al, 2003;Servaes and Tamayo, 2013;Manchiraju and Rajgopal, 2017;Clarkson et al, 2019), cost of equity capital (Dhaliwal et al, 2011), labour productivity (Christensen et al, 2017), earning quality (Kim et al, 2012), and even the propensity to commit high-profile corporate misconduct (Christensen, 2016). Given such evidence, companies both within the United States and globally are increasingly providing standalone CSR reports voluntarily, in addition to traditional corporate financial disclosures, in response to the growing demand for CSR information by stakeholders (KPMG, 2015).…”

mentioning

confidence: 99%

A Textual Analysis of US Corporate Social Responsibility Reports

Clarkson

Ponn²,

Richardson

et al. 2020

Abacus

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We employ computer‐based textual analysis to examine disclosure patterns for a sample of US corporate social responsibility (CSR) reports from the period 2002–2016. Starting from 466 features commonly used in computational linguistics, our results show that the linguistics or disclosure patterns in CSR reports can be used to accurately predict the actual CSR performance type of CSR reporters. Specifically, we find that the two most commonly used disclosure characteristics, number of words and number of sentences, alone can be used to predict reporting firms’ CSR performance type with 81% accuracy. The accuracy of prediction increases to 96% when the top 50 linguistics features most relevant to firms’ CSR performance are included in the prediction model. In addition, we find that the linguistic features of CSR disclosure identified by our study are incrementally value relevant to investors even after controlling for the actual CSR performance score from the professional CSR rating agencies. This finding suggests that the linguistic features of CSR disclosure can be an important venue for capital market participants in evaluating firms’ CSR performance type, especially when professional CSR performance ratings are not available.

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Does Corporate Social Responsibility (CSR) Create Shareholder Value? Evidence from the Indian Companies Act 2013

Cited by 319 publications

References 74 publications

Unattended social wants and corporate social responsibility of leading firms: Relationship of intrinsic motivation of volunteering in proposed welfare programs and employee attributes

Unattended social wants and corporate social responsibility of leading firms: Relationship of intrinsic motivation of volunteering in proposed welfare programs and employee attributes

CSR Performance, Financial Reporting, and Investors’ Perception on Financial Reporting

A Textual Analysis of US Corporate Social Responsibility Reports

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