What do we know about tax aggressiveness and corporate social responsibility? An integrative review

Whait, Rob; Christ, Katherine L.; Ortas, Eduardo; Burritt, Roger

doi:10.1016/j.jclepro.2018.08.334

Cited by 87 publications

(93 citation statements)

References 82 publications

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“…The CSR construct has undergone a lasting evolution and has been combined with issues in practice, such as human rights, labor rights, environmental protection, consumer protection and fighting corruption, and different definitions place different degrees of emphasis on these points [12][13][14]. More than 35 CSR definitions have been discussed in the literature [15].…”

Section: Csr Construct and Differentiation Strategymentioning

confidence: 99%

Building Consumer-Oriented CSR Differentiation Strategy

Fang²,

Sun

2019

Sustainability

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In a fierce competitive industry, firms conducting a corporate social responsibility (CSR) differentiation strategy can build a relative advantage. However, there is lack of literature to discuss the approach to identifying companies’ CSR differentiation conditions. Based on the theoretical foundations of consumers’ responses to CSR differentiation strategies, this paper proposes a consumer-oriented approach to identify CSR differentiation by using the best–worst scaling approach. In the context of the mobile phone industry, CSR activities were prioritized according to the extent to which they were valued by consumers. Consumers’ perceptions of the CSR activities of Huawei and Apple were also assessed in this study. Finally, the CSR differentiation conditions between the two companies was evaluated. The findings include the following: (1) the consumer priorities for different CSR activities vary greatly, and it is essential for firms to adopt a CSR differentiation strategy; (2) it is feasible to adopt a proper CSR premium in product pricing to build a socially responsible company; and (3) the lack of CSR communication between companies and consumers leads to consumers’ perceived distortion. The results provide implications for firms’ CSR practice.

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Section: Csr Construct and Differentiation Strategymentioning

confidence: 99%

Building Consumer-Oriented CSR Differentiation Strategy

Fang²,

Sun

2019

Sustainability

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“…Spurred by globalization, corporate tax avoidance practices have been experiencing a rapid proliferation around the world. They are now so rampant that they have become part of acceptable and sound business practices (Barford & Holt, 2013;Whait et al, 2018). Indeed, present-day businesses are being structured in such ways to exploit loopholes in tax laws (Christensen & Murphy, 2004).…”

Section: Corporate Tax Avoidance and Primary Duties Of Companiesmentioning

confidence: 99%

“…The popularity of corporate tax avoidance practices is fueled by managers who inherently do not regard such measures as erroneous or even iniquitous (Sikka, 2010). They are adamant that companies possess the rights and freedom like any other taxpayers to manage their taxes so long they abide by the letters of laws (Hasseldine & Morris, 2013;Gribnau, 2015;Lanis et al, 2018;Whait et al, 2018;Hillenbrand et al, 2019). It should be borne in mind that companies are essentially created as investment vessels and managers are contractually bound to serve the shareholders' interests.…”

Section: Corporate Tax Avoidance and Primary Duties Of Companiesmentioning

confidence: 99%

“…The logic of capitalism asserts that the ultimate corporate responsibility is to generate profit for the shareholders' economic benefit (Friedman, 1970;Sikka, 2010;Elbra & Miller, 2017;Whait et al, 2018). Consequently, managers are often subject to intense pressures by especially risk-indifferent shareholders to produce higher corporate profit and firm value (Hanlon & Heitzman, 2010;Whait et al, 2018). It includes expecting the managers to pursue opportunities to reduce expenses such as taxes, as long as the benefits of doing so exceed the costs.…”

Section: Shareholder Approach Toward Corporate Tax Avoidancementioning

confidence: 99%

“…As social sciences' theories allow a grasp on how people act and the world they live in, they form a constructive tool in rationalizing and foretelling managerial actions towards shareholders and stakeholders. These theories are thus relevant for examining the socio-political nature and human elements in corporate tax avoidance (Whait et al, 2018). Indeed, both shareholder and stakeholder approaches form part of the normative theories of business ethics even though they are polar opposite (Smith, 2003).…”

Section: Introductionmentioning

confidence: 99%

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A Theoretical Review on Corporate Tax Avoidance: Shareholder Approach versus Stakeholder Approach

Mohanadas

Sallehhuddin

Ramasamy

2019

J. Fin. Bank. Review

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Objective - Although corporate tax avoidance is a widely discussed topic in the literature, conflicts do emerge when it is analyzed through the context of primary corporate duty. Should companies, in managing their taxes, solely honor their obligation to increase shareholders' wealth or should they cater to the interests of all their stakeholders? Such conflicts are especially evident in the inconsistent empirical observations on how corporate tax avoidance relate to corporate social responsibility (CSR), which makes the dearth of theoretical analysis on this issue even more conspicuous. Taking into account the socio-political nature and human elements in corporate tax avoidance, theoretical analyses from social sciences' perspectives are becoming markedly crucial. Methodology/Technique – This paper critically reviews the extant literature for discussions on how corporate tax avoidance is influenced by the dissenting approaches towards primary corporate duty. Findings – By allowing an insight into how people act and the world they live in, these analyses form a constructive tool to rationalize and foretell managerial actions towards shareholders and stakeholders alike. Novelty – It focuses particularly on the theories that are widely used to lend supports for such approaches. These theories are the agency theory, stakeholder theory, and legitimacy theory. Type of Paper - Review. Keywords: Corporate Tax Avoidance; Corporate Social Responsibility (CSR); Theoretical Analysis; Shareholder Approach; Stakeholder Approach; Agency Theory; Stakeholder Theory; Legitimacy Theory. JEL Classification: G30, G32, G39.

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Giving too much and paying too little? The effect of corporate social responsibility on corporate lobbying efficacy: Evidence of tax aggressiveness

Lin

2020

Corp Soc Responsibility Env

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Though lobbying accounts for a significant proportion of corporate political expenditure, comprehensive research on its advantages is scarce. Further, research findings have been inconclusive in quantifying political lobbying expenditures' rate of return. Using data from Fortune's America's Most Admired Companies (AMAC) with publicly available financial statements for the period from 2008 to 2017, this study delved into the tax benefits of lobbying using the dynamic panel system GMM and quantile regression model. This study found strong evidence that corporate lobbying is associated with higher levels of tax aggressiveness. The results also show that firms that spend more on lobbying in a given year pay lower effective tax rates. Additionally, this study revealed that the reputational effects of corporate social responsibility lead to the increased effectiveness of corporate lobbying expenditures. Thus, political lobbying affects tax enforcement, resulting in lower tax burdens for politically active firms. These results are consistent with the conjecture that firms with high levels of social responsibility and political lobbying are more tax aggressive. This study has addressed the need to quantify the benefits of lobbying and corporate social responsibility activities, especially in terms of lower tax payments and better financial returns to shareholders while still meeting the needs of non‐owner stakeholders.

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What do we know about tax aggressiveness and corporate social responsibility? An integrative review

Cited by 87 publications

References 82 publications

Building Consumer-Oriented CSR Differentiation Strategy

Building Consumer-Oriented CSR Differentiation Strategy

A Theoretical Review on Corporate Tax Avoidance: Shareholder Approach versus Stakeholder Approach

Giving too much and paying too little? The effect of corporate social responsibility on corporate lobbying efficacy: Evidence of tax aggressiveness

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