Firm Characteristics, Industry Context, and Investor Reactions to Environmental CSR: A Stakeholder Theory Approach

Cordeiro, James J.; Tewari, Manish

doi:10.1007/s10551-014-2115-x

Cited by 216 publications

(177 citation statements)

References 74 publications

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“…These benefits are especially visible when firms are trying to anticipate future regulations and trends, in order to prevent, rather than correct, negative environmental impacts, by following proactive environmental strategies (Aragon‐Correa & Sharma, ). Firms with superior environmental performance can reduce operating costs, have better use of resources and capabilities, and take advantage of market opportunities created by an increasing demand for environmental friendly goods and services, in addition to managing risk, including reputational risk, and in general, increasing the economic benefits derived from improved stakeholder relations (Cordeiro & Tewari, ). Corporate sustainability is also increasingly a consideration in the investment decisions of institutional investors (Alda, ) concerned about their reputation (Pucheta‐Martínez & López‐Zamora, ).…”

Section: Theoretical Framework and Research Hypothesesmentioning

confidence: 99%

“…The literature on corporate environmental management shows that proactive corporate environmental management strategies that include environmentally friendly investments, policies, and programs may be used by companies to gain competitive advantage, enhancing their position in the market and developing the resources and capabilities useful for building long-term profit potential (Aragon-Correa & Sharma, 2003;Bansal & Roth, 2000;Buysse & Verbeke, 2003;Cordeiro & Tewari, 2015). These benefits are especially visible when firms are trying to anticipate future regulations and trends, in order to prevent, rather than correct, negative environmental impacts, by following proactive environmental strategies (Aragon-Correa & Sharma, 2003).…”

Section: Theoretical Framework and Research Hypothesesmentioning

confidence: 99%

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Board gender diversity and corporate environmental performance: The moderating role of family and dual‐class majority ownership structures

2020

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While prior work has investigated the impact of (a) ownership structure and (b) board gender diversity separately on corporate environmental performance, researchers have not studied the potentially important relationship between ownership control and female board diversity in influencing corporate environmental performance jointly. We do so in the context of majority ownership in family‐controlled and dual‐class firms whose motives and influence are theoretically different from that of the firm's minority shareholders. Drawing on resource dependency, socioemotional wealth theory, and secondary agency theory, we hypothesize that majority family owners and dual‐class owners likely choose women directors to help advance their personal preferences for environmental corporate social responsibility. Our empirical tests utilizing 2,755 U.S. firm years over the 2010–2015 show that, as hypothesized, these two majority ownership types interact with board gender diversity to positively influence corporate environmental performance.

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Section: Theoretical Framework and Research Hypothesesmentioning

confidence: 99%

Section: Theoretical Framework and Research Hypothesesmentioning

confidence: 99%

Board gender diversity and corporate environmental performance: The moderating role of family and dual‐class majority ownership structures

2020

Self Cite

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“…This allows banks to reduce credit risk and responsibilities derived from the environmental pollution of their clients, while improving their reputation. With the same objective of reducing environmental risks, individual investors react positively to the news of superior corporate environmental performance, and negatively to the announcement of adverse environmental incidents influencing the firms' market value in developed and developing countries [88,89].…”

Section: Hypothesis 1 (H1) Corporate Environmental Performance (Cep)mentioning

confidence: 99%

Analyzing the Effect of Corporate Environmental Performance on Corporate Financial Performance in Developed and Developing Countries

2017

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Abstract:The relationship between corporate environmental performance and corporate financial performance has been extensively studied in developed countries, and has received less attention in developing countries. For this reason, the main objective of this paper is to examine the effect of corporate environmental performance on corporate financial performance during a global financial crisis, depending on the economic development level of the country where a firm is located. To this end, we obtain data for a sample of 2982 large firms from 2008 to 2015. We apply Petersen's approach to these data, adjusting the standard errors for clustering by both firm and year. The results obtained show that the adoption of environmental practices significantly and positively affects the corporate financial performance in developed and developing countries. However, this effect is stronger for firms located in developing countries than those located in developed countries.

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“…This positive impact on corporate financial results derives from the maximization of shareholder value [71], reputation-related benefits [72,73] cost and risk reduction [74,75], and lower stock price volatility [76]. Cordeiro and Tewari [77] argue that the investor reaction on announcing firm's engagement in ESG activities is the re-estimation of the firm's future cash flows due to the possible retention and attraction of superior employees, the attraction of customers with green preferences, or reducing possible penalties, fines, and other sanctions from regulatory bodies. Thus, we should expect that these effects will be stronger in the long term [29,78].…”

Section: Esg and Shareholder Value Creationmentioning

confidence: 99%

ESG Issues among Fund Managers—Factors and Motives

Przychodzeń¹,

Gómez‐Bezares

Przychodzeń

et al. 2016

Sustainability

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This paper investigates the motives, behavior, and characteristics shaping mutual fund managers' willingness to incorporate Environmental, Social and Governance (ESG) issues into investment decision making. Using survey evidence from fund managers from five different countries, we demonstrate that this predisposition is the stronger, the shorter their average forecasting horizon and the higher their level of reliance on business risk in portfolio management is. We also find that the propensity to incorporate ESG factors is positively related to an increasing level of risk aversion, an increasing importance of salary change and senior management approval/disapproval as motivating factors as well as length of professional experience in current fund and increasing significance of assessment by superiors in remuneration. Overall, our evidence suggests that ESG diligence among fund managers serves mainly as a method for mitigating risk and is typically motivated by herding; it is much less important as a tool for additional value creation. The prevalent use of ESG criteria in mitigating risk is in contrast with traditional approach, but it is in line with behavioral finance theory. Additionally, our results also show a strong difference in the length of the forecasting horizon between continental European and Anglo-Saxon fund managers.

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Firm Characteristics, Industry Context, and Investor Reactions to Environmental CSR: A Stakeholder Theory Approach

Cited by 216 publications

References 74 publications

Board gender diversity and corporate environmental performance: The moderating role of family and dual‐class majority ownership structures

Board gender diversity and corporate environmental performance: The moderating role of family and dual‐class majority ownership structures

Analyzing the Effect of Corporate Environmental Performance on Corporate Financial Performance in Developed and Developing Countries

ESG Issues among Fund Managers—Factors and Motives

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