Using Csr Disclosure Quality To Develop Social Resilience To Exogenous Shocks: A Test F Investor Perceptions

Keywords

CSR disclosure; Exogenous shock; Organizational legitimacy; Social resilience

Abstract

Our overarching purpose is to propose and test a theory of social resilience to exogenous shocks. The theory posits that high-quality corporate social responsibility (CSR) disclosure promotes the perception of organizational legitimacy, creating social resilience to exogenous shocks (external events outside management control). Using a path model and data from 100 experienced, nonprofessional investors, we examine whether the quality of a corporation’s voluntary CSR disclosure increases its perceived organizational legitimacy and if increases in perceived legitimacy help insulate that organization from negative investor reactions following an exogenous shock. The results provide strong support for the model and show that when CSR disclosures are higher quality, investors perceive organizational legitimacy to be higher, inferring that organizations should emphasize quantifiable, consistent, and comparable reporting. Further, the results indicate that higher levels of perceived organizational legitimacy are associated with greater levels of organizational resilience to an intra-industry exogenous shock.

Publication Date

1-1-2015

Publication Title

Behavioral Research in Accounting

Volume

27

Issue

2

Number of Pages

155-177

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.2308/bria-51118

Socpus ID

84947754861 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/84947754861

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