Socially Irresponsible and Illegal Behavior and Shareholder Wealth

Frooman, Jeff

doi:10.1177/000765039703600302

Cited by 388 publications

(264 citation statements)

References 44 publications

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“…When customers are dissatisfied with a product or its associated services, investors apprehend that negative customer reactions in the form of decreased patronage, lawsuits, or both, will directly affect the bottom line (Berman et al, 1999). Event studies establish that market value of a company decreases when corporate irresponsibility and illegal behavior is observed (Frooman, 1997). The news of pesticide content in Pepsi and Coca-Cola beverages in India reduced the sales of both companies by 60% (Financial Express, 2006).…”

Section: Csr Towards Customers and Firm Performancementioning

confidence: 99%

Does Corporate Social Responsibility Influence Firm Performance of Indian Companies?

2010

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ABSTRACT. This study examines whether corporate social responsibility (CSR) towards primary stakeholders influences the financial and the non-financial performance (NFP) of Indian firms. Perceptual data on CSR and NFP were collected from 150 senior-level Indian managers including CEOs through questionnaire survey. Hard data on financial performance (FP) of the companies were obtained from secondary sources. A questionnaire for assessing CSR was developed with respect to six stakeholder groups -employees, customers, investors, community, natural environment, and suppliers. A composite measure of CSR was obtained by aggregating the six dimensions. Findings indicate that stock-listed firms show responsible business practices and better FP than the non-stock-listed firms. Controlling confounding effects of stock-listing, ownership, and firm size, a favorable perception of managers towards CSR is found to be associated with increase in FP and NFP of firms. Such findings hold good when CSR is assessed for the six stakeholder groups in aggregate and for each stakeholder group in segregate. Findings suggest that responsible business practices towards primary stakeholders can be profitable and beneficial to Indian firms.

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Section: Csr Towards Customers and Firm Performancementioning

confidence: 99%

Does Corporate Social Responsibility Influence Firm Performance of Indian Companies?

2010

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“…CSR also reduces business risk (Moore, 2001;Orlitzky & Benjamin, 2001). Certain event studiesalso prove that CSR increase the profitability (Frooman, 1997). Therefore, it can be conjectured from literature that CSR leads to better corporate financial performance of firms.…”

Section: Csr and Financial Performancementioning

confidence: 99%

A Structural Equation Model of CSR and Performance: Mediation by Innovation and Productivity

Al-Shuaibi¹

2016

JMS

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This study has explored the role of Innovation and productivity as mediating factors between Corporate Social Responsibility (CSR) and firm's Performance relationship. The objectives of this study are to build and test a theoretical model to identify the mediating factors in the linkage between CSR and performance.The theoretical model (CIPP Model) is deduced using strategic paradigm of literature. It consists of CSR, Innovation, Productivity, and Performance dimensions. Furthermore, several hypotheses were generated to examine the model. Structural Equation Modeling (SEM) is employed to test the model using data from CSR practicing firms 197 from Saudi Arabia. Confirmatory Factor Analysis (CFA) is performed followed by Structural Equation Modeling to examine the model. The results generally support the hypothesized model with research and managerial implications. The mediation of Innovation along with productivity in CSR linkage to performance isa major contribution to the literature, which may help to explore the black box in the relationship of CSR with performance. Besides proving the business case for the CSR in general, it also advocates the adoption of CSR practices by firms and MNEs operating in the developing countries, as it may enhance innovation and productivity leading to their increased financial performance. This model would be practical and useful for business managers that seek a competitive solution for succeeding in a business crisis and work in the settings of international business.

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“…: Despite this, research, bibliometric analyses (De Bakker et al 2005) and recent meta analyses have produced a common stand which tends to overcome these problems (Allouche and Laroche 2005;Orlitzky et al 2003;Orlitzky and Benjamin 2001;Frooman 1997;Wu 2006;Margolis et al 2007), providing evidence of a positive correlation between CSR and economic performance. Margolis et al (2007) concluded, After 35 years of research, the preponderance of evidence indicates a mildly positive relationship between corporate social performance (CSP) and CFP'.…”

Section: The Business Case Of Csr: Csr and Its Relationship With Compmentioning

confidence: 99%

CSR Policies: Effects on Labour Productivity in Spanish Micro and Small Manufacturing Companies

Sánchez

Benito‐Hernández

2013

J Bus Ethics

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This paper analyses empirical evidence of efforts to enable Spanish micro and small manufacturing companies to boost their labour productivity rates through the development of the main pillars of their corporate social responsibility (CSR) policies. This study aims to develop new approaches and sensibilities towards work from an ethical, values (virtues) and CSR perspective, showing how internal dimensions of CSR, such those related to relationships with employees and responsibility in processes and product quality, can improve labour performance and labour efficiency, thereby contributing to a better society. The results of a sample of 929 small businesses indicate that the social responsibility policies that most contributed to a short-term increase in labour productivity are those related to internal aspects of the company, in particular its involvement in the quality of processes and products, promotion of innovation and employee care. However, the impact on labour productivity of CSR policies related to external factors, such as relationship with stakeholders and environmental concern, could not be empirically proven in this paper.

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Socially Irresponsible and Illegal Behavior and Shareholder Wealth

Cited by 388 publications

References 44 publications

Does Corporate Social Responsibility Influence Firm Performance of Indian Companies?

Does Corporate Social Responsibility Influence Firm Performance of Indian Companies?

A Structural Equation Model of CSR and Performance: Mediation by Innovation and Productivity

CSR Policies: Effects on Labour Productivity in Spanish Micro and Small Manufacturing Companies

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