Executive compensation and corporate social responsibility: does a golden parachute matter?

2020 ◽  
Vol 16 (5) ◽  
pp. 575-598
Author(s):  
Collins E. Okafor ◽  
Nacasius U. Ujah
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Executive Compensation ◽  
Firm Value ◽  
Moderating Effect ◽  
Inverse Association ◽  
Content Type ◽  
Golden Parachute ◽  
Corporate Social

PurposeThis study examines the efficacy of compensation in encouraging corporate executives to promote corporate social responsibility (CSR). In particular, it closely examines the effect of a golden parachute (GP) on an executive's behavior toward CSR.Design/methodology/approachThis study uses longitudinal data on 1,301 US firms for the period from 1993 to 2013. The data comes from Compustat, MSCI ESG STATS, RiskMetrics and ExecuComp.FindingsWe find an inverse association between current and long-term compensations and GP on firms' CSR. However, a test on the moderating effect discloses that a GP and long-term compensation jointly and positively increase the firms' CSR performance. This increase supports the idea that executives with a GP seek to maximize their long-term wealth by approving CSR projects that add value. The results also show that female executives are more likely to promote CSR than their male counterparts, and older executives are less willing to engage in CSR projects.Practical implicationsAdding a GP contractual clause to the executive compensation package could encourage greater engagement in CSR projects. The CEO with a GP will ensure that the firm engages in only value-enhancing CSR projects; this should align the interest of the society (greater firm engagement in CSR) with the interest of the firm (value maximization).Originality/valueThis study contributes to the literature by examining the moderating effect of a GP on the association between CSR and executive compensation.

Do board directors and good corporate governance improve integrated reporting quality? The moderating effect of CSR: an empirical analysis

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jamel Chouaibi ◽  
Saida Boulhouchet ◽  
Raghad Almallah ◽  
Yamina Chouaibi
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Moderating Effect ◽  
Integrated Reporting ◽  
Board Diversity ◽  
Content Type ◽  
Board Characteristics ◽  
Good Corporate Governance ◽  
Corporate Social

PurposeThis paper targets to shed light on the relationship between board characteristics, good corporate governance and the integrated reporting quality (IRQ) and even if this relationship is moderated by the corporate social responsibility.Design/methodology/approachData from a sample of 185 European firms selected from STOXX 600 Index between 2010 and 2019 are used to test the model using panel data and multiple regression. This paper is motivated by using panel data estimated feasible generalized least squares method. A multiple regression model is used to analyze the moderating effect of the corporate social responsibility on the association between board characteristics, good corporate governance and the IRQ.FindingsConsistent with the expectations, the results showed that there is a positive relationship between board independence, board diversity, good corporate governance and IRQ. Furthermore, the findings suggest that moderating effect positively affects the relationship between the board characteristics, good corporate governance and IRQ.Practical implicationsThe results of this study have an impact on policymakers. The presence of women and independent members of the board should be encouraged. This has a positive effect on the availability of high-quality information, able to drive investment levels and stakeholder participation.Originality/valueThis study supports the existing literature. First, it expands the scientific debate on the topic of integrated reporting (IR). Second, it extends the scope of agency theory, which is rarely used to explain IR-related phenomena. This study is one of the first to examine the moderating effect of corporate social responsibility on the association between a set of governance characteristics (i.e. Board independence and board diversity) and integrated reporting adoption.

Corporate governance and corporate social responsibility interface: a case study of private equity

2020 ◽  
Vol 20 (4) ◽  
pp. 703-717 ◽  
Author(s):  
Virgo Süsi ◽  
Krista Jaakson
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Firm Value ◽  
Private Equity ◽  
Resource Dependence Theory ◽  
Medium Size ◽  
Content Type ◽  
Corporate Social

Purpose This paper aims to explore why private equity (PE) cares about corporate social responsibility (CSR) of its investees given their relatively short investment time-horizon and how it designs corporate governance (CG) bundle to achieve both financial and CSR goals of the private firms it invests in. Design/methodology/approach Case study design is applied to get deeper insights on the why and how questions posed. Analysis is based on triangulation of secondary data and in-depth interviews with both PE and their investee firms. Findings The authors find that long-term sustainability supported by CSR increases firm value. They also outline specific CG bundle that the PE uses to achieve both its financial and CSR goals. CG mechanisms appeared to reflect agency theory, but even more resource dependence theory. Practical implications The outlined CG bundle could be used as a template for all types of private firm owners to improve both financial and CSR performance of the firm. Originality/value The paper adds to fragmented area of CG and CSR interface. The authors specifically focus on several under-researched contexts of this interface: private small and medium size firms (SMEs), emerging markets and PE investors.

Exploring the role of corporate social responsibility skepticism in ethical purchase intention

2019 ◽  
Vol 16 (2) ◽  
pp. 291-307 ◽  
Author(s):  
Salmi Mohd Isa ◽  
Phaik Nie Chin ◽  
Irene Liew
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Peer Influence ◽  
Purchase Intention ◽  
Moderating Effect ◽  
Equation Modeling ◽  
Research Approach ◽  
Content Type ◽  
Corporate Social ◽  
The Relationship

Purpose Few studies exist which delve into the possible factors that prevent ethically minded consumers from translating their ethical perceptions into ethical purchase intention (EPI). Thus, this study aims to explore how consumers assess corporate social responsibility (CSR) based on several influencing factors toward EPI, with CSR skepticism (SKP) as a moderator. Design/methodology/approach This cross-sectional study is conducted through a self-administered questionnaire and uses a positive research approach with a quantitative basis of enquiry. The partial least squares–structural equation modeling- model is used to examine the causal relationship between seven independent variables of CSR assessment (i.e. CSR awareness, knowledge of CSR position of company, cause importance, price consciousness, CSR image of company, credibility of CSR efforts and peer influence) with EPI. In addition, this study also examines the moderating effect of SKP in the relationship. Findings The findings show that CSR assessment factors are important to convert mere purchase criteria into EPI and SKP does play a significant role in weakening the relationship. Originality/value This study examines the moderating effect of CSR skepticism, the exploration of which still remains very limited in current literature.

Social impact of a corporate social responsibility initiative

2019 ◽  
Vol 9 (4) ◽  
pp. 344-362 ◽  
Author(s):  
Brendan Riggin ◽  
Karen Danylchuk ◽  
Dawn Gill ◽  
Robert Petrella
Keyword(s):  
Physical Activity ◽  
Health Promotion ◽  
Weight Loss ◽  
Corporate Social Responsibility ◽  
Waist Circumference ◽  
Social Responsibility ◽  
Social Impact ◽  
Content Type ◽  
Corporate Social

PurposeThe purpose of this paper is to examine the social impact of an initiative (Hockey FIT) aimed at improving the health and well-being of sport fans and their community.Design/methodology/approachFans (n=80) participated in 12 weekly health promotion sessions hosted in local hockey club facilities. Objective health measurements, diet and physical activity levels of fans were measured at baseline, 12 weeks and 12 months, to determine the intermediate, long-term, individual and community impact. Furthermore, one-on-one interviews with 28 program participants were conducted to further understand the program’s social impact.FindingsThe intermediate impact was noticed as improvements in weight loss, body mass index, waist circumference, systolic blood pressure (BP), steps per day, healthful eating, self-reported overall health and fatty food scores at 12 weeks. The long-term individual impact of Hockey FIT was realized as participants maintained or continued to improve their weight loss, waist circumference, healthful eating, systolic BP and diastolic BP 12 months after the program had been offered. The program was also reported to increase family bonding time and improved the diet, daily physical activity, and general awareness of health promotion programs and components for friends, family members and coworkers.Originality/valueThe positive health-related results from this study contradict prior research that has suggested there is minimal evidence of any substantial contributions from social programs in sport. Through a collective approach to corporate social responsibility, this research demonstrates the ability for sport organizations to contribute to meaningful social change and the positive role that they play within the community.

Disclosure of corporate social responsibility (CSR) and its implications on company value as a result of the impact of corporate governance and profitability

2020 ◽  
Vol 62 (4) ◽  
pp. 339-354
Author(s):  
Kamaliah Kamaliah
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Firm Value ◽  
Partial Least Square ◽  
Least Square ◽  
Content Type ◽  
Csr Disclosure ◽  
Corporate Social ◽  
The Impact

Purpose The purpose of this study is to examine the effect of corporate governance and corporate profitability on firm value with corporate social responsibility (CSR) disclosure as the intervening variable. Design/methodology/approach The population of this study was all companies listed in the LQ 45 Index group in the Indonesia Stock Exchange in 2013-2014. The inferential statistics used in this study applied the partial least square (PLS) based structural equation model (SEM) method with the assistance of SmartPLS 2.0. The PLS method was selected based on the consideration that there was a construct formed with reflective indicators in this study. Findings From the results of this study, it can be concluded that corporate governance does not have any effect on CSR disclosure, profitability of company has an effect on CSR disclosure, CSR disclosure has an effect on firm value. In addition, CSR disclosure does not mediate the effect of on firm value. These results showed that corporate governance can have an effect on firm value directly, and there is no role of CSR disclosure in mediating the effect of corporate governance on firm value, and profitability of company has an effect on firm value through CSR disclosure. Originality/value The originality of this research is on the reason that many studies that have been conducted still indicated the inconsistency in the results and diversity of the indicators, so that a similar research was conducted by involving the indicators used for measuring the corporate governance variable, which were the proportion of independent commissioners and audit committee. Meanwhile, for the profitability variable, return on assets and return on equity were used as the indicators.

scholarly journals CSR Disclosure, Corporate Governance and Firm Value: a study on GCC Islamic Banks

2020 ◽  
Vol 28 (4) ◽  
pp. 607-638
Author(s):  
Mohd Shukor Harun ◽  
Khaled Hussainey ◽  
Khairul Ayuni Mohd Kharuddin ◽  
Omar Al Farooque
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Institutions ◽  
Firm Value ◽  
Islamic Banks ◽  
Content Type ◽  
Gcc Countries ◽  
Islamic Financial Institutions ◽  
Corporate Social

Purpose This study aims to explore the corporate social responsibility disclosure (CSRD) practices of the Islamic banks in the Gulf Cooperation Council (GCC) countries during the period 2010-2014 and examines the determinants of CSRD and its effects on firm value. Design/methodology/approach Based on the Accounting and Auditing Organization for Islamic Financial Institutions Governance Standard No. 7 guidelines and using content analysis, the paper develops a comprehensive CSRD index for GCC Islamic banks. The study applies ordinary least squares regression analysis for hypothesis testing and for finding determinants of respective dependent variables. Findings The results show a very low level of CSRD among the sample Islamic banks in GCC countries. When using corporate governance characteristics to examine the determinants of CSRD, this study provides evidence of a significant positive association between board size and CSRD practice in Islamic banks and a significant negative relationship of chief executive officer (CEO) duality with CSRD, as per expectation. For the economic consequences of CSRD, the study documents an inverse performance effect of CSRD while board size, board composition and CEO duality indicate significant positive effects on firm value. Research limitations/implications The relatively small sample size of GCC Islamic banks may limit the application of the findings to other Islamic financial institutions such as Takaful and the Islamic unit trust company. Practical implications The findings of this study initiate the global debate on the need for corporate governance reform in Islamic banks by providing insights on the role played by corporate governance mechanisms in encouraging and enhancing CSRD practices among Islamic banks. The findings also have important implications for investors, managers, regulatory bodies, policymakers and Islamic banks in the GCC countries. Social implications The results of the study do not support the idea that Islamic banks operating on Islamic principles can meet their social responsibilities through promoting corporate social responsibility (CSR) activities and by differentiating themselves from non-Islamic banks. Originality/value This is the first study to examine the determinants of CSRD in GCC Islamic banks using comprehensive CSRD and corporate governance variables and, therefore, adds value to the existing CSR literature in banking.

Earnings management, financial performance and the moderating effect of corporate social responsibility: evidencefrom France

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Salma Chakroun ◽  
Anis Ben Amar ◽  
Anis Ben Amar
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Financial Performance ◽  
Moderating Effect ◽  
Least Square ◽  
Content Type ◽  
Academic Researchers ◽  
Corporate Social ◽  
The Impact

Purpose The purpose of this paper is to examine the impact of earnings management on financial performance. In addition, the authors investigate whether corporate social responsibility has a moderating effect on the impact of earnings management on financial performance. Design/methodology/approach The empirical study is based on a sample of French companies listed on the CAC-All-Tradable index over the period 2008–2018. Feasible generalized least square regression method is used to estimate the econometric models. Findings Based on panel data of 3,003 French firm-year observations, the authors demonstrate that earnings management has a negative and significant impact on financial performance. Indeed, corporate social responsibility moderates positively the negative impact of earnings management on financial performance in the French context. Practical implications The findings have several implications for regulatory, investors and academic researchers. For regulators, it is appropriate to promote more several standards related to corporate social responsibility and earnings management. For investors, considering societal issues is very important in making decisions. For academic researchers, the results show that it is important to discover how corporate social responsibility can influence the relation between earnings management and financial performance. Originality/value The existing literature has generally focused on the impact of earnings management on financial performance and the empirical tests did not yield similar results. The study shows that corporate social responsibility has a moderating role in determining the impact of earnings management on financial performance.

The impact of corporate social responsibility (CSR) priming on consumers’ consumption and lifestyle choices with intertemporal tradeoffs

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hajar Fatemi ◽  
Laurette Dube
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Experimental Studies ◽  
Unhealthy Food ◽  
Content Type ◽  
Trade Offs ◽  
Lifestyle Choices ◽  
Corporate Social ◽  
The Impact

Purpose This paper aims to study the unexplored possibility that priming firms’ corporate social responsibility (CSR) activity in consumers’ minds may impact consumers’ preference for non-firm related consumption and lifestyle choice options with intertemporal trade-offs. Design/methodology/approach Across four experimental studies, the authors looked at the impact of CSR priming on the preference of participants for later larger versus sooner smaller money (Study 1), saving versus spending (Study 2) and healthy versus unhealthy food choices (Studies 3 and 4). These choice options were not related to the focal firm that practiced CSR. The authors measured the changes in participants’ consideration of future consequences (CFC) as a potential mediator for the results. Findings The participants in the CSR condition showed a higher CFC and a higher preference for the options with long-term benefits and immediate costs over the ones with long-term costs and immediate benefits, i.e. later larger over sooner smaller money, saving over spending and healthy over unhealthy food. The authors documented a mediation role for CFC. Research limitations/implications All the participants in the studies were from the USA. Looking at the cultural differences can enrich the understanding of the impact of CSR on preference for the options with intertemporal trade-offs. Furthermore, this paper builds its theoretical justification based on the assumption of individuals’ acceptance of CSR activities. Nevertheless, consumers may have skepticism about these activities. Future studies may investigate the effect of CSR skepticism of individuals on the proposed effects. Additionally, investigating the moderating roles of individuals’ characteristics like their prosocial concern or their knowledge about choice options might be an avenue for future research. Practical implications The findings highlight the benefits of CSR priming on consumers’ welfare and normative behavior. Firms may use the findings to understand and manage the impact of other firms’ CSR communications on the evaluation of their own products. Originality/value This research is the first to highlight the impact of CSR priming on consumers’ non-firm-related consumption and lifestyle choices with intertemporal trade-offs. The results showed the positive effect of priming firms’ CSR activities on consumers’ CFC and the mediating role of CFC.

From surface to deep corporate social responsibility

2016 ◽  
Vol 7 (2) ◽  
pp. 275-287 ◽  
Author(s):  
Cameron Richards ◽  
Irina Safitri Zen
Keyword(s):  
Sustainable Development ◽  
Corporate Social Responsibility ◽  
Social Learning ◽  
Social Responsibility ◽  
Policy Implementation ◽  
Public Awareness ◽  
Policy Research ◽  
Content Type ◽  
Corporate Social

Purpose The purpose of this paper is to develop and explore the policy concept of corporate social responsibility (CSR) as a focus for sustainable development. To this end, it develops and explores the implications of a distinction between CSR as a marketing strategy and a more sustainable long-term commitment to changes in organizational culture and also society. Design/methodology/approach This a conceptual paper which develops a policy research framework for examining the CSR rationale as well as general concept as applied to the “plastic bags” public awareness campaign in the Malaysian case study. On this basis, its central inquiry approach is to develop and explore the distinction between surface and deep modes of CSR policy implementation as also related modes of social learning. Findings The findings from the conceptual inquiry recognize that corporations which fail to apply a deep rather than a surface commitment to their own CSR polices will sooner or later be judged on that basis by their customers as well as external stakeholders. Although CSR policies will always involve a corporate marketing focus, this is sustainable only if framed by a long-term organizational commitment to accountable change. Originality/value The paper makes, develops and further explores a basic accountability distinction between surface and deep modes of CSR as a management commitment, corporate policy implementation and related processes of corporate cultural change. This links to the paper’s associated innovation of linking CSR as both internal organizational learning and a larger sustainable development process of social learning.

Corporate social responsibility, stock salience, and the asymmetric market impact of consumer sentiment news on Spanish firms

2015 ◽  
Vol 7 (2) ◽  
pp. 98-115
Author(s):  
Barry Oliver ◽  
Blanca Pérez-Gladish ◽  
Paz Méndez-Rodríguez
Keyword(s):  
Corporate Social Responsibility ◽  
Stock Market ◽  
Social Responsibility ◽  
Consumer Sentiment ◽  
Global Compact ◽  
Un Global Compact ◽  
Content Type ◽  
Negativity Effect ◽  
Corporate Social

Purpose – The purpose of this paper is to identify whether the Spanish stock market experiences a negativity effect on the announcement of Spanish consumer sentiment information and if firms that are signatory to the UN Global Compact on corporate social responsibility are relatively more salient in the minds of investors. Design/methodology/approach – The authors use consumer sentiment announcements to show how the negativity effects on the Spanish stock market are significantly influenced by how salient the stock is in the minds of investors. If a firm’s stock exhibits negativity effects on the release of consumer sentiment information then this stock is salient to investors. If firms who are signatory to the UN Global Compact exhibit significant negativity effects, it could be concluded that these stocks are salient, particularly if firms that are not signatory to the Global Compact do not exhibit a similar negativity effect. Findings – The IBEX35 index experiences significant negativity effects upon the release of Spanish consumer sentiment announcements. This is similar to that reported in other countries, notably Australia and the USA. Using the constituent firms in the IBEX35 index, the authors find that those firms that are signatory to the UN Global Compact are significantly more likely to experience negativity effects upon the release of Spanish consumer sentiment information than if they are not signatory to the Global Compact. This indicates that firms that are part of the UN Global Compact are more salient to investors. Research limitations/implications – Available published Spanish data on consumer sentiment. Practical implications – Little is understood of the impact that consumer sentiment announcements have on stock prices. Studies in USA and Australia have identified significant negativity effects in stock markets when consumer sentiment information is released. This research has found that a psychological negativity bias occurs in firms that are salient to investors. Salience has been found to be important in asset pricing. Originality/value – This paper tries to find out which companies are more likely to sign the UN Global Compact. These companies are more sensitive to consumer sentiment, because they depend on the everyday decisions of the consumers. The more the companies depend on consumers, the more they care about them. And, when the consumer sentiment goes down, they are more affected by this sentiment. These firms are also more worried about the long term. They are not only thinking about the profits in the short term but also about maintaining the generation of profits in the long term.

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