Reactive or proactive? Investor sentiment as a driver of corporate social responsibility

Cheong, Calvin W. H.; Sinnakkannu, Jothee; Ramasamy, Sockalingam

doi:10.1016/j.ribaf.2017.07.002

Cited by 38 publications

(13 citation statements)

References 46 publications

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“…Implementing voluntary initiatives for businesses to improve their employees' labor conditions and implementing socially significant projects creates a particular environmental protection sphere. Application of these practices on corporate responsibility in developing markets are found in the following readings: Benlemlih (2019) , Borges et al (2018) , Cheong et al (2017) , Denisov et al (2018) , Ge and Zhao (2017) , Gong and Ho (2018) , Han and Zheng (2016) , Krivtsov (2014) , Lee et al (2018) , Li and Liu (2018) , Malik and Kanwal (2018) , Marquis et al (2017) , Morozova et al (2018) , Mukherjee et al (2018) , Nazri et al (2018) , Popkova (2017) , Schrempf-Stirling (2018) , and Veselovsky et al (2018) , Chu et al (2018) , Frig et al (2018) , Harjoto and Laksmana (2018)) , Kansal et al (2018) , Sheikh (2019) , Utgård (2018) .…”

Section: Theoretical Backgroundmentioning

confidence: 99%

Corporate Social Responsibility Amid Social Distancing During the COVID-19 Crisis: BRICS vs. OECD Countries

Popkova

DeLo

Sergi

2021

Research in International Business and Finance

101

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This paper compares today’s corporate management in developing markets (BRICS countries) vs. developed markets (the OECD countries). The influence of determining a new social corporate management season considering social distancing amid the COVID-19 pandemic on emerging markets' economic growth is ascertained and set apart from corporate management in developing markets. This paper helps clarifying and better understanding the role of corporate social responsibility in the conditions of an economic crisis against the background of the COVID-19 pandemic. This work provides scientific arguments that allow solving critical discussions regarding the advantages (growth of quality of life, an increase of business's competitiveness) and costs (limitation of economic growth, non-commercial use of profit, and increased price for goods and services) of domestic production and consumption. In the long-term, responsible financial practices return all investments and allow countries to better cope with a crisis. The research supplies a new view of corporate social responsibility as a measure of crisis management. It reflects its advantages at a time of social distancing in the conditions of the COVID-19 pandemic. The institutionalization of corporate social responsibility in emerging countries is not predetermined by internal factors (approach to doing business or organizational culture), if not by external factors (market status, state regulation, and consumer awareness). These circumstances prove the high complexity of strengthening corporate social responsibility in developing countries. In the conditions of social distancing – due to the COVID-19 pandemic – corporate social responsibility goes to a new level. In both developing and developed countries, one of the most widespread manifestations of corporate social responsibility is the entrepreneurship's transition to the remote form of activities. This envisages the provision of remote employment for workers and the online purchase of goods and services for consumers.

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Section: Theoretical Backgroundmentioning

confidence: 99%

Corporate Social Responsibility Amid Social Distancing During the COVID-19 Crisis: BRICS vs. OECD Countries

Popkova

DeLo

Sergi

2021

Research in International Business and Finance

101

View full text Add to dashboard Cite

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“…Social norm theory posits that managers are affected by (religious) norms in their local geographic area. Since extrinsic religiosity has a significant role in developing individual attitudes and behaviors, and eventually, corporate behavior as well, a firm's risk-taking behaviour may either be extrinsically or intrinsically driven (Cheong et al, 2017) or both. Second, they contend that it is difficult to determine how religious a firm's decision makers are, especially in public-listed firms.…”

Section: Research Gapmentioning

confidence: 99%

“…Stock price volatility is also driven by investor sentiments. Firms that behave in a manner that conforms to social expectations experience lower stock price volatility (Cheong et al, 2017). As religious managers are highly valued and inspire confidence (Gebauer et al, 2012) firms with religious managers should experience lower equity risk.…”

Section: Religion and Equity Riskmentioning

confidence: 99%

Religiosity and Corporate Risk-taking

Cheong

2018

AJFA

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This paper studies the influence of religiosity on corporate risk-taking. The study uses unique micro-level data on religious devotion and distinguishes between manager religiosity, firm intrinsic religiosity, firm extrinsic religiosity, and social capital. Analysis shows that manager religiosity is associated with lower risk-taking. Firm intrinsic religiosity however, moderates this association. Further analysis shows that managers of Islamic firms are more likely to make risky decisions as compared to managers of other firms due to socio-religious pressure. Manager religiosity is also associated with lower firm equity risk. The results also suggest that strong external monitoring weakens the negative relationship between religiosity and risk-taking. This study shows how religious managers may be a double-edged sword. Religious managers are not risk-takers but are susceptible to social pressure. They are however, also more well-adjusted to a changing environment which inspires confidence in the markets.

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“…We attempt to fill this research gap by assessing both the probability and substantiveness of CSR disclosure in response to crises. Second, although investors are a powerful group with the ability to influence a company's direction [19], studies have mainly focused on the demands of other stakeholders (e.g., governments and customers) [9,20]. We thus focus on the pressure exerted by investors through criticism on social media platforms.…”

Section: Introductionmentioning

confidence: 99%

Corporate Social Responsibility Disclosure: Responding to Investors’ Criticism on Social Media

Zhang

Yang

2021

IJERPH

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Companies use corporate social responsibility (CSR) disclosures to communicate their social and environmental policies, practices, and performance to stakeholders. Although the determinants and outcomes of CSR activities are well understood, we know little about how companies use CSR communication to manage a crisis. The few relevant CSR studies have focused on the pressure on corporations exerted by governments, customers, the media, or the public. Although investors have a significant influence on firm value, this stakeholder group has been neglected in research on CSR disclosure. Grounded in legitimacy theory and agency theory, this study uses a sample of Chinese public companies listed on the Shanghai Stock Exchange to investigate CSR disclosure in response to social media criticism posted by investors. The empirical findings show that investors’ social media criticism not only motivates companies to disclose their CSR activities but also increases the substantiveness of their CSR reports, demonstrating that companies’ CSR communication in response to a crisis is substantive rather than merely symbolic. We also find that the impact of social media criticism on CSR disclosure is heterogeneous. Non-state-owned enterprises, companies in regions with high levels of environmental regulations, and companies in regions with local government concern about social issues are most likely to disclose CSR information and report substantive CSR activities. We provide an in-depth analysis of corporate CSR strategies for crisis management and show that crises initiated by investors on social media provide opportunities for corporations to improve their CSR engagement.

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Reactive or proactive? Investor sentiment as a driver of corporate social responsibility

Cited by 38 publications

References 46 publications

Corporate Social Responsibility Amid Social Distancing During the COVID-19 Crisis: BRICS vs. OECD Countries

Corporate Social Responsibility Amid Social Distancing During the COVID-19 Crisis: BRICS vs. OECD Countries

Religiosity and Corporate Risk-taking

Corporate Social Responsibility Disclosure: Responding to Investors’ Criticism on Social Media

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