Effects of Corporate Social Performance on Default Risk: Structural Model-Based Analysis on Japanese Firms

2018 ◽  
pp. 179-199
Author(s):  
Megumi Suto ◽  
Hitoshi Takehara
Keyword(s):  
Default Risk ◽  
Structural Model ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Model Based ◽  
Japanese Firms ◽  
Corporate Social ◽  
Model Based Analysis

The Economics and Politics of Corporate Social Performance

2011 ◽  
Vol 13 (2) ◽  
pp. 1-46 ◽  
Author(s):  
David P. Baron ◽  
Maretno Agus Harjoto ◽  
Hoje Jo
Keyword(s):  
Structural Model ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Simultaneous Equation ◽  
Social Pressure ◽  
Equation Model ◽  
Social Activists ◽  
Consumer Markets ◽  
Industrial Markets ◽  
Corporate Social

Firms operate in a capital market, a product market, and a market for social pressure directed at them by social activists, NGOs, and governments. An equilibrium in these three markets yields a three-equation structural model that relates corporate financial performance (CFP), corporate social performance (CSP), and social pressure. This paper estimates the simultaneous equation model for a panel of over 1,600 firms and finds that CFP is uncorrelated with CSP and negatively correlated with social pressure. CSP is decreasing in CFP and increasing in social pressure. Social pressure is increasing in CSP and decreasing in CFP, which is consistent with social pressure being directed to soft targets. Disaggregating the panel indicates that CFP is positively correlated with CSP for firms in consumer markets and negatively correlated for industrial markets. For consumer markets, CSP is increasing in CFP, which is consistent with a perquisites hypothesis that managers spend on CSR when they can afford it. For industrial markets CSP is decreasing in CFP, which is consistent with a moral management hypothesis. For both consumer and industrial markets, CSP is responsive to social pressure.

scholarly journals Corporate Social Performance and the Likelihood of Bankruptcy: Evidence from a Period of Economic Upswing

2021 ◽  
Author(s):  
Florian Habermann ◽  
Felix Bernhard Fischer
Keyword(s):  
Default Risk ◽  
Instrumental Variable ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Related Literature ◽  
Stakeholder Relationships ◽  
Positive Effects ◽  
Business Environments ◽  
Corporate Social ◽  
Positive Effect

AbstractThe paper aims to investigate the effects of corporate social performance (CSP) on bankruptcy likelihood in times of economic upswing. This is important because prior related literature focused on data containing times of economic crises. We measure bankruptcy likelihood with the Altman Z score and CSP with Refinitiv ESG scores. By applying static panel data regressions and instrumental variable regressions on a sample of 6696 US-firm-year observations from 2010 to 2019 our main findings are: (i) In contrast to existing research, the level of firms’ CSP seems to have no (positive) effect on the likelihood of bankruptcy during times of economic upswing. (ii) Increasing a firm’s CSP in times of economic upswing leads to a rise in bankruptcy likelihood. We conclude that the positive effects of CSP on stakeholder relationships fail to materialize in flourishing business environments. The costs of increasing CSP, thus, exceed their immediate positive effects and raise bankruptcy likelihood. However, as they reduce financial default risk in subsequent crises, CSP investments can be seen as a balancing measure. Our findings bear implications for scholars, practitioners, and policymakers.

Corporate Social Performance and Investment Decision

2017 ◽  
Vol 18 (1) ◽  
pp. 9-44
Author(s):  
Doocheol Moon ◽  
Seungwha Chung ◽  
Hyunjung Choi
Keyword(s):  
Corporate Social Performance ◽  
Social Performance ◽  
Investment Decision ◽  
Corporate Social

A Special-Purpose Taxonomy of Corporate Social Performance Concepts

2001 ◽  
Vol 1 (1) ◽  
pp. 42-72 ◽  
Author(s):  
Brett A. Stone
Keyword(s):  
Mutual Fund ◽  
Corporate Social Performance ◽  
Social Issues ◽  
Social Performance ◽  
Socially Responsible ◽  
Fund Managers ◽  
Responsible Investing ◽  
Research Areas ◽  
Socially Responsible Mutual Funds ◽  
Corporate Social

The first iteration of a nonstatic special-purpose taxonomy of corporate social performance concepts is developed from a mailed, self-administered survey completed by managers of U.S. socially responsible mutual funds. The study combines the traditionally disparate research areas of Corporate Social Performance and Socially Responsible Investing. As a partial update of Rockness and Williams (1988), a descriptive account is presented of what mutual fund managers regard as the social issues that constitute corporate social performance. The resulting taxonomy represents an empirically derived framework useful in considering social accounting in general and accounting standard setting in particular.

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