Recency effects in the buffering of negative news by corporate social responsibility advertising

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Joon Hye Han ◽  
Gary Davies ◽  
Anthony Grimes
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Order Effects ◽  
Content Type ◽  
Recency Effects ◽  
Determining Factors ◽  
Negative News ◽  
Attribution Of Blame ◽  
Corporate Social ◽  
A Company

PurposeDrawing from the theory of how relevant items are processed in memory when making judgements, this study aims to test for recency effects between CSR advertising and related, negative news on how a company is perceived and the explanatory roles of environmentalism, attribution and both feelings and attitudes towards the advertising itself.Design/methodology/approachThis study uses between-subjects experimental design with pretests.FindingsOrder effects exist, which, when ads and news are similarly influential, evidence a recency effect. The process is explained by both the mediating influence of attribution of blame and the moderation of this influence by attitude towards the environment. Differences between the effectiveness of ads are explained by the mediating influence of attitudes towards and feelings about the ad together with the moderation of this influence by involvement in the ad context.Practical implicationsCorporate social responsibility (CSR) ads should be pretested in the context of related but negative news, and not just on their own, to ensure they can buffer such news. CSR ads can be more effective when following rather than preceding such news and should not be withdrawn if such a crisis occurs.Originality/valueThe research first attempts to explain recency effects theoretically from the influence of CSR ads on negative CSR-related news. It also shows the determining factors in how such effects influence consumers by considering attribution, environmentalism, attitude to the context and attitude and feelings towards CSR ads.

Corporate social responsibility, governance and stakeholders: a bank in the upbeat of the crisis

2016 ◽  
Vol 12 (4) ◽  
pp. 388-412 ◽  
Author(s):  
Frank Jan de Graaf
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Governance Structure ◽  
Governance System ◽  
Content Type ◽  
Social Responsibilities ◽  
The Social ◽  
Corporate Social ◽  
A Company

Purpose Using the global financial crisis as a critical event and based on institutional theory and stakeholder theory, this paper aims to explore the relationship between corporate governance and corporate social responsibility (CSR). The question is how stakeholders can influence corporate responses to societal change by using their position in the governance structure. Design/methodology/approach The analysis is based on a historical analysis of data collected mainly between 2002 and 2004. The historical perspective enables an understanding of the response of the company to environmental changes. Findings The approach enables researchers to relate the normative component of CSR to specific governance mechanisms. These governance mechanisms are specified in direct and indirect influence pathways. Historical data shed light on how, in the upbeat of the crisis, stakeholders have influenced the principles and policies of the ING Group, a Dutch financial company. Research limitations/implications The paper suggests that stakeholders influence principles – normative assumptions that guide corporate decisions – mainly in dialogue-based meetings (direct influence pathways). Companies are made accountable in indirect influence pathways such as regulations. The author also demonstrates that a historical approach enables an understanding of long-term historical developments and the linking of corporate policies to the normative assumptions of stakeholders. Practical implications If stakeholders wish to assess the social responsibility of a company, then they should assess the governance structure in relation to the principles and policies. The power structure within a company and that within the institutional framework in which the company operates (the governance system) strongly influences how a company executes its social responsibilities. Social implications The paper demonstrates how stakeholders can use the governance structure to influence a bank. If society – or a specific group in society – wants banks to play a different role, this paper points to what could be the levers of change in the governance system and the governance structure. Originality/value Insights into the complex relationship between corporate governance and the processes in which the social responsibilities of a company are developed.

Can investing in corporate social responsibility lower a company's cost of capital?

2014 ◽  
Vol 31 (2) ◽  
pp. 202-222 ◽  
Author(s):  
Marcelo Cajias ◽  
Franz Fuerst ◽  
Sven Bienert
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Cost Of Capital ◽  
Task Force ◽  
Equity Capital ◽  
Content Type ◽  
Starting Point ◽  
Corporate Social ◽  
The Cost ◽  
A Company

Purpose – This paper aims to investigate the effect of corporate social responsibility (CSR) ratings on the ex ante cost of capital of more than 2,300 listed US companies in a panel from 2003 to 2010. It examines whether financial markets value continuous investment in CSR activities through higher market capitalization and lower cost of capital. Design/methodology/approach – The measure of the cost of capital reflects the perceived riskiness of individual companies expressed in the unobserved internal rate of return that investors expect to hold a risky asset. Based on descriptive portfolio estimations, panel and quantile regressions, the authors model the cost of equity capital as a function of CSR strengths and concerns obtained from the KLD-database and accounting controls. Findings – The authors show that firms' CSR strategies differ significantly across industry sectors. Customer-orientated companies such as telecommunications and automobile outperform asset-driven sectors such as real estate or chemical companies. Furthermore, the authors find a 10-bp positive effect for one standard deviation of firms' intensive allocation of resources in sustainable activities. Research limitations/implications – Since the authors are interested in the effect environmental, social and governance activities have on the firm's perceived market valuation rate, the authors apply the Fama-French model because of its efficiency in explaining realized returns, rather than incorporating analyst's long-term growth forecasts into the proxy for the equity premium. Practical implications – Managers of companies with low or intermediate CSR scores may consider the financial benefits of improving their social and environmental performance. A good starting point is usually to draw up a company-wide CSR agenda, possibly guided by a dedicated CSR task force, mapping out the potential costs and benefits of such measures. In addition, by improving their CSR ratings, a company may get access to additional resources, ranging from the growing ethical investment industry to employees for whom CSR performance matters when choosing an employer. Originality/value – The authors expand the existing literature by considering firm's CSR level to be in relation to the overall CSR performance and decompose firm's CSR agenda into strengths and concerns rather than counting the number of activities a firm is involved in. The applied methodology allows a better understanding of firm's CSR agenda and its implication for capital markets and investors on both long and short investment terms.

Reducing skepticism about corporate social responsibility: roles of gender and agentic-communal orientations

2019 ◽  
Vol 36 (1) ◽  
pp. 189-196 ◽  
Author(s):  
Kevin P. Newman ◽  
Rebecca K. Trump
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Target Market ◽  
Content Type ◽  
And Gender ◽  
The Individual ◽  
Corporate Social ◽  
A Company ◽  
Practical Implications

Purpose Companies are increasingly emphasizing corporate social responsibility (CSR). However, consumers are often skeptical of the sincerity of companies’ CSR claims, particularly when the claim comes directly from the company. This paper aims to demonstrate how to reduce consumer CSR skepticism by examining the role of a company spokesperson’s gender and gender-related characteristics. Design/methodology/approach Two between-subjects experiments with a combined total of 329 participants examined how consumers’ levels of CSR skepticism are affected depending on the gender of the consumer and the gender and gender-related characteristics of the company’s CSR spokesperson. Findings Study 1 finds that a female (vs male) spokesperson generally elicits less CSR skepticism. However, Study 2 expands on this to demonstrate that consumers are less skeptical of a company’s CSR efforts when they are promoted by a spokesperson who exhibits gender-related characteristics that match, or are typically associated with, the individual consumer’s gender. Practical implications Brands often face difficulties in successfully promoting their own CSR efforts to skeptical consumers. These findings should guide companies and their brands in choosing ideal spokespeople for making effective, sincere CSR claims, depending on the target market. Originality/value This research is the first to identify the important role of gender in consumers’ perceptions of CSR sincerity. Thus, it provides practically-oriented strategies that may mitigate a growing consumer CSR skepticism that exists in today’s marketplace.

Corporate social responsibility and bankruptcy

2019 ◽  
Vol 36 (2) ◽  
pp. 130-153 ◽  
Author(s):  
Elizabeth Cooper ◽  
Hatice Uzun
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Matched Sample ◽  
Content Type ◽  
Financial Failure ◽  
Research Questions ◽  
The Difference ◽  
Corporate Social ◽  
A Company

Purpose This paper aims to examine corporate social responsibility (CSR) and corporate bankruptcy. Specifically, the authors ask the following research questions: Does CSR play a role in determining the likelihood of bankruptcy? Does CSR explain the difference in the probability of that firm eventually reorganizing and emerging from bankruptcy? Design/methodology/approach The authors address these questions by testing three CSR theories using a sample of 78 firms that filed for Chapter 11 bankruptcy during the period 2007 to 2014 along with a matched sample of firms that did not. Findings Overall, the findings indicate that stronger CSR firms are less likely to become bankrupt relative to weaker CSR firms, all else being equal. This result is in line with the stakeholder theory of CSR. However, results do not support the conjecture that CSR matters when it comes to bankruptcy emergence. While CSR seems to influence whether a company experiences bankruptcy in the first place, having strong CSR does not seem to help a firm once it has filed for Chapter 11. Research limitations/implications This paper extends the existing CSR literature but looks at CSR not from the angel of financial “success” but rather from financial “failure”. Practical implications The results could potentially help academics and practitioners alike in seeking understanding and reason behind CSR involvement and bankruptcy avoidance and success. Originality/value This is the first paper to test whether CSR plays a role in bankruptcy. The authors use a recent sample of firms with CSR scores that experienced a bankruptcy and a matched sample of CSR-scored firms that did not experience bankruptcy.

Corporate social responsibility and earnings management in the EU: a panel data analysis approach

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Panagiotis E. Dimitropoulos
Keyword(s):  
Corporate Social Responsibility ◽  
Panel Data ◽  
Social Responsibility ◽  
Earnings Management ◽  
Financial Reporting ◽  
Negative Association ◽  
Content Type ◽  
Corporate Social ◽  
The Eu

Purpose Over the past decades, corporate social responsibility (CSR) has been considered as a significant corporate strategy and also has been documented as a main information dissemination mechanism of corporations to shareholders, creditors and other external stakeholders. This fact makes the CSR activities and CSR performance interconnected with the quality of firms’ financial reporting. The purpose of this paper is to study the impact of CSR performance on the earnings management (EM) behaviour using a sample from 24 European Union (EU) countries summing up to 121,154 firm-year observations over the period 2003–2018. Design/methodology/approach The study uses a multi-country data set with various dimensions of CSR performance including indexes regarding workforce, community relations, product responsibility and human rights protection. The empirical analysis is conducted with panel data regressions. Findings Evidence supports the negative association between CSR and EM indicating that high CSR performing firms are associated with less income smoothing and discretionary accruals, thus with higher financial reporting quality. Practical implications Regulatory agencies in the EU could use the findings of the study for the improvement of the accounting framework via enhancing the use and publications of social and environmental responsibility information and reports. Social implications Also, the current paper could be of interest not only to academic researchers but also to potential and existing investors in European corporations. The negative association between CSR performance and EM could be used by investors in assessing the risk of firms and the quality and reliability of their financial information. Originality/value This is the first study within the EU, which considers the multi-facet characteristics of CSR on the quality of accounting earnings and offers useful policy implications for regulators and investors.

Consequences of corporate social responsibility on employees

2019 ◽  
Vol 49 (1) ◽  
pp. 231-249
Author(s):  
Evans Asante Boadi ◽  
Zheng He ◽  
Eric Kofi Boadi ◽  
Josephine Bosompem ◽  
Philip Avornyo
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Social Exchange ◽  
Structural Equation ◽  
Social Exchange Theory ◽  
Banking Sector ◽  
Work Motivation ◽  
Content Type ◽  
Time Lagged ◽  
Corporate Social

Purpose The purpose of this paper is to draw on affect social exchange theory and related literature to develop and test a research model linking employees’ perception of corporate social responsibility (CSR) to their outcomes [performance and organisational pride (ORP)] with moderating variables: perceived work motivation patterns (autonomous and controlled motivation) to sustain firm’s operations through their employees. Design/methodology/approach The authors used Ghana as a case for this study due to recent turbulences in the banking sector of Ghana. A sample data of 244 subordinate/supervisor dyads from rural and community banks was collected with a time-lagged technique and analysed through a structural equation modelling for this study. Findings These employee’s perceptions of CSR positively related to their performance and ORP. Autonomous motivated employees had a stronger positive moderated impact on perceived CSR-Performance link whereas controlled motivated employees recorded a stronger impact on perceived CSR-ORP link. Practical implications Based on these results, managers and human resource (HR) professionals can aim at acquiring favourable employees’ perception of their firms’ CSR initiatives. In that, it can help firms to remain in business particularly in difficult times. Also, autonomous and controlled motivators may seem inversely related, however, they are not contradictory to each other. Both can coexist within a firm and it is crucial that HR professionals and managers endeavour to balance them discreetly to attain organisational goals. Originality/value Despite the growing interest in CSR across continents, CSR outcomes on employees among small and medium scale firms especially in Africa has fairly been toned-down by respective management of firms, governments and researchers.

Board diversity and corporate social responsibility in Jordan

2016 ◽  
Vol 14 (2) ◽  
pp. 279-298 ◽  
Author(s):  
Abdul Hadi Ibrahim ◽  
Mustafa Mohd Hanefah
Keyword(s):  
Corporate Social Responsibility ◽  
Data Analysis ◽  
Panel Data ◽  
Social Responsibility ◽  
Panel Data Analysis ◽  
Arab Countries ◽  
Board Diversity ◽  
Content Type ◽  
Csr Disclosure ◽  
Corporate Social

Purpose This study aims to investigate the impact of board diversity characteristics, namely, independence, gender, age and nationality of directors on the level of corporate social responsibility (CSR) disclosures. Design/methodology/approach Content analysis was used to determine CSR disclosure. This study used panel data analysis to investigate the influence of board diversity characteristics on CSR disclosures. Findings Panel data analysis show that the level of CSR disclosure has increased over the period of study. Results also reveal a positive and significant association between the level of CSR disclosure and board diversity variables. Research limitations/implications This study examined only companies listed on Amman Stock Exchange. Therefore, the generalisation of the results might be limited to the listed companies only. Practical implications Findings are relevant to policymakers, professional organisations and practitioners in Jordan and in other Arab countries. Social implications The role of women in the boardroom is important to ensure more CSR activities by the listed companies. Jordan being a Muslim country should take the initiative to introduce laws to increase the number of women to the board. Originality/value This study offers significant contributions to existing CSR literature in Jordan and in other Arab countries by introducing female directors. Findings are important to policymakers. They should implement quotas for women in the boardroom, and adopting such a policy will increase the participation of women in the decision-making process of the companies and reduce gender bias.

Establishing a benchmark for continuous HR improvement

2016 ◽  
Vol 24 (1) ◽  
pp. 1-3
Author(s):  
Claire Clifford
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Human Resource ◽  
Design Methodology ◽  
Response Rate ◽  
Leadership Communication ◽  
Content Type ◽  
Corporate Social

Purpose – This paper explains how Sabio approached benchmarking of their overall human resource (HR) performance. Design/methodology/approach – Sabio asked employees for feedback, achieving an impressive 92 per cent response rate. Findings – Feedback from employees highlighted issues around leadership, communication and corporate social responsibility. The article explains how Sabio addressed these issues. Originality/value – This paper gives a first-hand account of benchmarking for HR departments and how the company addressed the issues raised.

Corporate social responsibility and organizational attractiveness: implications for talent management

2016 ◽  
Vol 12 (3) ◽  
pp. 484-505 ◽  
Author(s):  
Joana Story ◽  
Filipa Castanheira ◽  
Silvia Hartig
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Well Being ◽  
Talent Management ◽  
Organizational Attractiveness ◽  
Firm Reputation ◽  
Content Type ◽  
Job Advertisement ◽  
Organizational Reputation ◽  
Corporate Social

Purpose Talent management is a twenty-first-century concern. Attracting talented individuals to organizations is an important source for firm competitive advantage. Building on signaling theory, this paper proposes that corporate social responsibility (CSR) can be an important tool for talent recruitment. Design/methodology/approach Across two studies, this paper found support for this hypothesized relationship. In Study 1, a job advertisement was manipulated to include information about CSR and tested it in two groups of 120 master’s degree students who would be in the job market within the year. It was found that CSR was an important factor that increased organizational attractiveness. In Study 2, with 532 external talented stakeholders of 16 organizations, our findings were replicated and advanced by testing whether perceptions of CSR practices (internal and external) influenced perceptions of organizational attractiveness and if this relationship was mediated by organizational reputation. Findings This study found that perceptions of internal CSR practices were directly related to both organizational attractiveness and firm reputation. However, perceptions of external CSR practices were related only to organizational attractiveness through organizational reputation. Research limitations/implications The article’s one of the main limitations has to do with generalizability of the results and the potential common method variance bias. Practical implications The findings demonstrate that CSR can play an effective role in attracting potential employees, through enhancement of organizational reputation and organizational attractiveness. If organizations are willing to implement practices that protect and develop their employees, along with practices that improve the quality of the natural environment and the well-being of the society, they can become an employer-of-choice. Originality/value This study expands on previous studies by including an experimental design, including two types of CSR practices and a mediating variable in this field study.

Enhancing the employer-employee relationship through corporate social responsibility (CSR) engagement

2015 ◽  
Vol 27 (7) ◽  
pp. 1479-1498 ◽  
Author(s):  
Daraneekorn Supanti ◽  
Ken Butcher ◽  
Liz Fredline
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Hotel Management ◽  
Content Type ◽  
Beneficial Effects ◽  
Specific Effects ◽  
Employee Relationship ◽  
Hotel Managers ◽  
Corporate Social ◽  
Csr Engagement

Purpose – The purpose of this study is to understand how hotel managers perceive the benefits that may accrue to employees and hotels through their engagement in corporate social responsibility (CSR) activities. Design/methodology/approach – In-depth interviews with 23 hotel managers, representing various functional responsibilities, were undertaken across four provinces in Thailand. The sample included local and international chain hotels. Findings – Hotel managers from all functional areas and levels acknowledged that CSR substantially enhanced the employer–employee relationship. Five themes depicting the beneficial effects were identified: a relationship unifying process, having fun, feeling pride, developing skills and building teamwork. These themes reflect three core factors of emotional responses, social capital and task-related skills. Practical implications – The paper illustrates that CSR activities can be customised to elicit specific effects that will engender beneficial outcomes for both hotel management and employees. Originality/value – This paper provides new insights into how hotel managers perceive the employer-employee relationship is enhanced through CSR engagement. In addition, the paper presents a practical model that will be of interest to both academics and practitioners.

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