Optimal Timing of Information Security Investment: A Real Options Approach

Author(s):  
Ken-ichi Tatsumi ◽  
Makoto Goto
2018 ◽  
Vol 10 (10) ◽  
pp. 3532 ◽  
Author(s):  
Kuo-Jung Lee

Corporate social responsibility (CSR) implementation could raise corporate reputations and benefit long-term development. Studying the effects of CRS on corporate valuation is essential. However, studies on the valuation of CSR are limited, particularly studies involving a dynamic model for valuing CSR. This study applies a real options approach to derive the company valuation of CSR investments, CSR options value, and the optimal timing for implementing CSR. This study elucidates the value of CSR and the decision to invest in CSR. Specifically, the value of CSR options facilitates determining whether to invest in CSR, and the optimal threshold for implementing CSR indicates explicitly when to invest in CSR. In addition, numerical analyses and results are demonstrated to verify the established model. This is the first and novel attempt to consider the valuation model and optimal strategies of CSR investments using the methods of real options.


2009 ◽  
Vol 36 (3) ◽  
pp. 329-345 ◽  
Author(s):  
Shyue-Liang Wang ◽  
Jyun-Da Chen ◽  
Paul A. Stirpe ◽  
Tzung-Pei Hong

Sign in / Sign up

Export Citation Format

Share Document