This study investigates whether socially responsible (CSR) firms behave responsibly in their financial reporting, specifically by constraining earnings management. This study first clarifies what a CSR firm is and identifies socially responsible firms through the KLD database. Three methods are used to detect earnings management—abnormal discretionary accruals, abnormal cash flows from operations and abnormal cash flows to net income ratios. This study concludes that CSR firms are less likely than their industry counterparts to participate in sales manipulations, are more likely to have higher cash flows from operations, and are more likely to have higher quality of earnings.
This research focused on employee preferences for CSR programs to understand if those preferences could lead to better CSR strategizing. Specifically, a CSR construct proposed by Rangan, Chase, and Sohel (2015) was analyzed though Exploratory Factor Analysis to understand if participants (employees in for-profit businesses) observed the CSR programs within the construct. Work orientation was the analyzed characteristic to see if this variable affected preferences toward CSR programs. Inconclusive results indicated that participants may not align with the proposed CSR construct, thus research could not proceed with the original hypotheses based on that construct. However, further analysis of data prompted a modification of the study to examine the importance placed on CSR programs based on Work Orientation. Results revealed that some Work Orientations were more statistically significant than others, but indicated that those with a Job orientation placed less importance on CSR programs compared to those with a Calling orientation.
The modern corporation's relationship to society has undergone drastic changes between the 1960s and the present day, in large part because the general public has held corporations to increasingly higher ethical and moral standards. While originally this relationship manifested itself only as punishment for extreme environmental and human rights violations, as made evident in the divestment movement in Apartheid South Africa and the backlash against Exxon after the Exxon Valdez oil spill, in the past twenty years firms are increasingly rewarded for going beyond the bare minimums set by regulators. Firms like Costco and WholeFoods exemplify this new trend in corporate America, and the current research tests whether a relationship exists between a firm's corporate social responsibility scores and its financial performance. Formally, the research predicts a positive correlation between strong corporate social responsibility and financial performance for firms listed in the S&P 500 in the consumer goods industry. The study relies on corporate social responsibility information provided by the KLD MSCI STATS database as well as financial information from the Mergent online database to test the theory on S&P 500 firms in the consumer goods industry.
Numerous studies have analyzed the relationship between a firm’s corporate social responsibility (CSR) and its corporate financial performance (CFP). This study observes the effects of CSR engagement pace on CFP, which is measured by both growth in pre-tax return on total earnings assets and Treynor risk-adjusted return. Using multiple ordinary least squares (OLS) models, this study finds no significant relationship between CSR engagement pace and CFP in five of the six models. This result is similar to the majority of previous studies, where the results indicate no significant relationship exists between CSR and CFP.
This study examines what factors influence decisions to purchase products associated with their companies’ corporate social responsibility (CSR) campaigns. The study highlights the discrepancy that exists between consumers’ stated intent to purchase products associated with CSR practices and their actual buying habits. The thesis then develops a model in which both personal values and awareness of CSR campaigns are tested as influences on consumers’ purchase decisions. This model is unique because it measures these two factors with respect to consumers’ brand loyalty of various products associated with CSR campaigns. The study collects survey and focus group data to answer three questions: (1) to what extent do brand loyalty, values, and awareness influence consumers’ decisions to purchase products associated with CSR campaigns, (2) how do demographic variables influence consumers’ values and awareness of CSR campaigns, and (3) why are consumers either influenced by or indifferent to products associated with corporate philanthropy campaigns?
Over recent decades, corporate social responsibility has become a very common strategy that companies are using to differentiate themselves in competitive markets. This paper uses a unique survey of Colorado College faculty and students and investigates whether this is an effective strategy. The results show that corporate social responsibility has a slightly negative effect on consumer’s intentions to purchase goods from a given company. On the other hand, the results show that corporate social responsibility has a positive effect on consumer’s likelihood to recommend products to someone else in the future. Also, previous literature has demonstrated that demographics matter. Therefore, we estimate the difference in difference coefficient for gender, nationality , department associated with at Colorado College, product type, and being a student or a faculty member. Each of these characteristics are found to be significant on whether an individual is affected by corporate social responsibility. These results show that corporate social responsibility initiatives are not always successful. Companies need to be mindful of the types of consumer behavior that are influenced as well as the types of people that are more likely to be influenced by corporate social responsibility initiatives.
Corporate social responsibility (CSR) is now a standard pillar of the corporate landscape. However, despite its prevalence, many CSR studies still boast ambiguous CSR taxonomy and fail to direct attention to some of the different mediums to which CSR manifests. Particularly, although various quantifiable metrics have been applied to deciphering the impact that CSR has on corporate financial statements, research into the evaluation of the relationship between CSR and the stock market has remained relatively neglected. This study first characterizes corporate social responsibility as either strategic, a profit-maximizing CSR classification derived from Baron (2001), or not-for-profit, a purely philanthropic action. Through this categorization, this study proceeds to test the stock market reactions to announcements articulating strategic and not-for-profit CSR initiatives. In addition, this study conducts time-specific tests to evaluate how shareholder preferences to both strategic and not-for-profit CSR initiatives have evolved throughout time. We find that as a whole, shareholders react more positively to strategic CSR than not-for-profit CSR and that shareholders have
This study examines the relationship between corporate social responsibility (CSR) and financial performance, but more specifically, the effects of CSR engagement strategy on cost of equity. The Sample is a panel dataset of 30 firms in the apparel, retail, and textile industry from 2007-2013. Using Fixed-effects, random-effects, and ordinary least squares models, the study finds no significant effect of CSR or CSR engagement strategy on cost of equity. These findings are in line with the majority of existing literature, such that the results indicate no clear relationship between CSR and financial performance exits.
Today, thanks to reduced state and federal funding, alumni donation participation not only plays a pivotal role in the national ranking and prestige of a given college, it is a critical source of income necessary for institutional stability. How, then, can a college like Colorado College (CC) distinguish itself; attracting and identifying more potential alumni donors? Using Advancement Services data from CC on roughly 25,000 alumni between the years 2012 and 2017, this study builds on previous econometric models to investigate and predict patterns of giving as they relate to individual characteristics and various Corporate Social Responsibility (CSR) initiatives. While the majority of individual level findings are consistent with past research, explorations of philanthropic giving tied to CSR and corporate match programs as well as specific institutional projects and funds lead to significant conclusions which warrant continued review to aid in effective donation practices.
This paper investigates the impact of Corporate Social Responsibility (CSR) on Corporate Financial Performance (CFP) in the United States and Europe between 2008-2017. Analyzing the top firms from the Globe Reptrack 100, the biggest study on corporate reputation worldwide, the paper puts forward evidence supporting stakeholder theory as well as CSR’s impact on earnings on both continents. The paper measures financial performance using the natural log of Net Income and Corporate Social Responsibility using CSR Hub data. Its findings both agree with and contradict the predominant literature. It concurs with the literature in its support of Stakeholder Theory as CSR is shown to be a positive indicator of financial performance. It diverges from the literature in that American firms are more highly rewarded for CSR investment than their European counterparts.