Which Dimension of Corporate Social Responsibility is a Value Driver in the Oil and Gas Industry?

Abstract

The oil and gas (O&G) industry suffers from a negative perception of poor sustainability. O&G companies are therefore engaged in several socially sustainable activities related to community development and environmental protection. This article determines whether the social, environmental, and economic dimensions of corporate social responsibility (CSR) are equally value-additive to O&G companies. We measure the company-specific level of CSR activities from the information provided in the annual financial reports of O&G companies and determine the effects of CSR dimensions on firm value. We find that CSR enhances firm value of O&G companies. While social activities such as employee well-being and community development are key value-drivers, environmental and economic sustainable activities have an insignificant impact on the market value of O&G companies. RésuméL'industrie pétrolière et gazière (O&G) souffre de la perception négative qu'on a de sa faible durabilité. C'est pourquoi les sociétés du secteur pétrolier et gazier s'investissent dans plusieurs activités socialement durables liées au développement communautaire et à la protection environnementale. Dans cet article, nous nous interrogeons sur la valeur ajoutée liée aux dimensions sociales, environnementales et économiques de la responsabilité sociale des entreprises (CSR) de ce secteur. Nous mesurons le niveau d'activité de la CSR de l'entreprise à partir des informations disponibles dans les rapports financiers annuels des sociétés pétrolières et gazières et déterminons les effets des dimensions de la CSR sur la valeur de l'entreprise. Les résultats montrent que la CSR augmente la valeur des sociétés pétrolières et gazières. Par ailleurs, tandis que les activités sociales telles que le bien-être des employés et le développement communautaire sont des facteurs clés de valeur, les activités environnementales et économiques durables n'ont qu'une incidence négligeable sur la valeur marchande des sociétés pétrolières et gazières

Where Does CSR Come from and Where Does It Go? A Review of the State of the Art

“…Three areas of CSR recurring in most definitions are economic, social, and environmental (Chowdhury et al 2019;Marí-Farinós 2017;Uribe-Macías et al 2018). The economic area of CSR has evolved from the sole obligation of accountability to shareholders (Carroll 1991;Friedman 1962;Friedman 1970) and analyzing the impact of actions on financial performance, to broadening its scope in the sense of considering other aspects, such as the capacity to create jobs, research leading to the discovery of new resources or new applications for them, as well as innovation and the promotion of technological progress (Jamali 2008).…”

“…Many of the research studies carried out on CSR have found relationships between the company's social, environmental, and financial and economic performance (Brogi and Lagasio 2019;Chowdhury et al 2019;Taliento et al 2019), concluding that the three dimensions are interconnected, and joint action ensures long-term sustainability. Likewise, all of them have a bearing on the generation of value for stakeholders in the long term, on the improvement of the relationship between stakeholders and the company, and on management's control and planning mechanisms that protect stakeholders' interests and expectations (Cupertino et al 2019;Jamali 2008;Pirnea et al 2011).…”

Is the corporate social responsibility–innovation link homogeneous?: Looking for sustainable innovation in the Spanish context

“…1087). This approach, which is largely accepted by both practitioners and academics (i.e., Bohlmann et al, 2018;Chowdhury, Choi, Ennis, & Chung, 2018;Martínez-Conesa et al, 2017;Sarkar & Searcy, 2016;Vanelslander, 2016) "gives equal weight to economic, environmental, and social dimensions" (Hussain, Rigoni, & Orij, 2018;p. 411).…”

“…It "refers to society's expectations that the firm will be profitable in the long term and obtain utilities as incentives and rewards for its efficiency and effectiveness by producing and selling quality goods and services First, when firms are looking to increase their efficiency, they tend to improve their process through cost-cutting practices. These practices lead firms to develop new or improved processes (Bocquet et al, 2013;Chowdhury et al, 2018). Second, all of the internal changes required to improve efficiency can foster the development of unique organizational capabilities (organizational innovations; FIGURE 1 Conceptual model I: CSRinnovation link Bocquet et al, 2013).…”

“…They have been selected on the basis of a careful literature review that has utilized similar items. In more concrete terms, the CSR variables are adapted from the CSRConPerScale developed byAlvarado-Herrera et al (2017) and used in the recent paper byCurras-Pérez et al (2018), combined with other items used in the previous literature (i.e.,Chowdhury et al, 2018;Kim et al, 2012).…”