Local Corporate Social Responsibility, Media Coverage, And Shareholder Value

Keywords

Corporate social responsibility; Intangibles; Media coverage; Stakeholder theory

Abstract

Using news articles covering firm's corporate social responsibility (CSR) activities, we find that publicized CSR activities are positively associated with shareholder value and improved future operating performance. Furthermore, we find that media coverage on CSR engagements with local impact on companies’ communities and employees, rather than those with broader social impact on the general public, is the main driver in explaining higher shareholder value and operating performance. We also implement a two-stage least-squares regression (2SLS) and propensity score matching to establish a causal link between publicized local CSR activities and shareholder value. Our evidence is consistent with the notion that shareholders put positive value on locally-oriented CSR when it is also complemented with high level of stakeholder awareness.

Publication Date

2-1-2018

Publication Title

Journal of Banking and Finance

Volume

87

Number of Pages

68-86

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.1016/j.jbankfin.2017.09.010

Socpus ID

85033555268 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/85033555268

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