scholarly journals Are Socially Responsible Managers Really Ethical? Exploring the Relationship Between Earnings Management and Corporate Social Responsibility

2008 ◽  
Vol 16 (3) ◽  
pp. 160-177 ◽  
Author(s):  
Diego Prior ◽  
Jordi Surroca ◽  
Josep A. Tribó
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Socially Responsible ◽  
Corporate Social ◽  
The Relationship

scholarly journals Corporate Social Responsibility and Earnings Management: Moderating Impact of Economic Cycles and Financial Performance

2021 ◽  
Vol 13 (17) ◽  
pp. 9969 ◽  
Author(s):  
Tiago Gonçalves ◽  
Cristina Gaio ◽  
André Ferro
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Financial Performance ◽  
Financial Reporting ◽  
The European Union ◽  
Socially Responsible ◽  
Economic Cycles ◽  
Corporate Social ◽  
The Relationship

This study analyses the relationship between earnings management and corporate social responsibility. To this end, we use a sample of 568 listed companies from the European Union between 2010 and 2018. We use discretionary accruals as the measure of earnings management, under the Modified Jones model. Corporate social responsibility is proxied by the Combined Environmental, Social and Governance Score from the ASSET4 database. We find a negative relation between earnings management and corporate social responsibility, suggesting that managers from more socially responsible companies have a more ethical behavior and, thus, financial reporting of higher quality. Additional analysis provides evidence that economic cycles and financial performance play important roles in the relation between earnings management and corporate social responsibility. During periods of crisis or of losses, the relationship is positive, suggesting that under unfavorable economic conditions, management makes opportunistic use of a sustainable company’s status to manage earnings.

Are All Narcissistic CEOs Socially Responsible? An Empirical Investigation of an Inverted U-Shaped Relationship Between CEO Narcissism and Corporate Social Responsibility

2021 ◽  
pp. 105960112110406
Author(s):  
Marwan Al-Shammari ◽  
Abdul A. Rasheed ◽  
Soumendra N. Banerjee
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Linear Relationship ◽  
Empirical Investigation ◽  
Fortune 500 ◽  
Ceo Power ◽  
Socially Responsible ◽  
Ceo Narcissism ◽  
Corporate Social ◽  
The Relationship

We investigate the relationship between CEO narcissism and corporate social responsibility (CSR). We suggest an alternative to the current assumption of a linear relationship between CEO narcissism and CSR. Instead, we propose an inverted U relationship between the two. Although narcissistic CEOs may engage in CSR, we argue that highly narcissistic CEOs may be drawn to actions that would garner greater attention and they may be less inclined to engage in CSR. Based on a sample of Fortune 500 firms during the period 2006–2013, we find support for an inverted U relationship and support for our arguments that CEO power moderates the relationship between CEO narcissism and CSR.

scholarly journals Corporate Social Responsibility & Market Volatility: Relationship and Trading Opportunities

2017 ◽  
Vol 10 (5) ◽  
pp. 1
Author(s):  
Vasiliki A. Basdekidou ◽  
Artemis A. Styliadou
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Social Performance ◽  
Environmental Aspects ◽  
Socially Responsible ◽  
Community Activities ◽  
The Social ◽  
The Usa ◽  
Corporate Social ◽  
The Relationship

This article examines the relationship between corporate social responsibility performance (CSR.P) and market trading volatility (MTV) provoking by the release of the non-farm employment payment-reports (NFP) the first Friday each month in the USA. It also discusses the trading opportunities involved in such as volatile environments. Actually, we consider the interaction between the social performance (for environment, employment and community activities) and the financial and trading performance than would be the case for an accumulated functionality in NFP releases. In general, social performance returns are negatively related to trading returns; so, the relatively poor financial and market trading reward (profit), offered by socially responsible ethical ETFs trading the NFP reports, is in accordance to their good social performance regarding employment and environmental aspects. This could be changed if these ethical ETFs incorporate into their arsenal of trading tools a number of CSR.mtv functions (utilities) discussed in this article. Impressively, we find also that considerable bizarre returns are obtained by funds, holding a portfolio of socially least unethical ETFs, involved in short-term or intraday speculations. In this domain, the complex relationship between social, financial and market trading performance, during the NFP “psychological time”, offers great trading opportunities.

Is Earnings Quality Associated with Corporate Social Responsibility?

2012 ◽  
Vol 87 (3) ◽  
pp. 761-796 ◽  
Author(s):  
Yongtae Kim ◽  
Myung Seok Park ◽  
Benson Wier
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Financial Reporting ◽  
Data Availability ◽  
Socially Responsible ◽  
Financial Reports ◽  
Top Executives ◽  
Accruals Quality ◽  
Corporate Social

ABSTRACT This study examines whether socially responsible firms behave differently from other firms in their financial reporting. Specifically, we question whether firms that exhibit corporate social responsibility (CSR) also behave in a responsible manner to constrain earnings management, thereby delivering more transparent and reliable financial information to investors as compared to firms that do not meet the same social criteria. We find that socially responsible firms are less likely (1) to manage earnings through discretionary accruals, (2) to manipulate real operating activities, and (3) to be the subject of SEC investigations, as evidenced by Accounting and Auditing Enforcement Releases against top executives. Our results are robust to (1) controlling for various incentives for CSR and earnings management, (2) considering various CSR dimensions and components, and (3) using alternative proxies for CSR and accruals quality. To the extent that we control for the potential effects of reputation and financial performance, our findings suggest that ethical concerns are likely to drive managers to produce high-quality financial reports. Data Availability: Data used in this study are available from public sources identified in the study.

scholarly journals CORPORATE SOCIAL RESPONSIBILITY AND EARNINGS MANAGEMENT: THE ROLE OF CORPORATE GOVERNANCE

2019 ◽  
Vol 7 (5) ◽  
pp. 1338-1347
Author(s):  
Gemi Ruwanti ◽  
Grahita Chandrarin ◽  
Prihat Assih
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Firm Size ◽  
Good Corporate Governance ◽  
Corporate Social ◽  
Relationship Of ◽  
The Relationship

Purpose: The purpose of this paper is to examine the role of corporate governance in the relationship of Corporate Social Responsibility (CSR) and firm size to earnings management of manufacturing firms in Indonesia. Methodology: The study draws on data from 66 firms listed in Indonesian Stock Exchange from 2014 to 2017, using a multiple regression model. The present study examines the influence of CSR on earnings management, and the impact of corporate governance on the relationship between CSR and firm size with earnings management. Main Findings: The finding showed that the effect of CSR on earnings management was significant and positive. The study also finds a statistically significant negative relationship between firm size and earnings management. The evidence also shows the role of corporate governance in the relationship of CSR and firm size to earnings management is significant and negative, it means that when the firm has good corporate governance, the firms that allocate CSR funds are relatively large, then it will tend not to practice earnings management, likewise large firms with good corporate governance will tend not to do earnings management. Research limitations/implications: The present study does not include all possible other variables that influence earnings management. Further research might increase the scope of research objects by extending the study period and need to pay attention to the firm's macro factors or economic risk factors outside of financial performance so as to provide a more comprehensive picture of the results of the study. Originality/value: The study focuses on the role of corporate governance issues such as the independence and activity of the boards and their influence on earnings management. The subject analyses the possible impact of CSR and firms size-related earnings management that has received much attention from academic research, which has largely focused on studying the publications of corporate governance in Indonesia context and can be contributes thoughts about the importance of corporate social responsibility activities that are reported as a basis for consideration incorporate policy-making to further enhance corporate awareness in the social environment, as well as the importance of corporate governance to minimize earnings management practices.

scholarly journals Corporate Social Responsibility And The Quality Of Executive Compensation Disclosures

2014 ◽  
Vol 30 (2) ◽  
pp. 625
Author(s):  
Walid Ben-Amar ◽  
Nadia Smaili ◽  
Eustache Ebondo Wa Mandzila
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Executive Compensation ◽  
Social Engagement ◽  
Disclosure Quality ◽  
Socially Responsible ◽  
Compensation Disclosure ◽  
Corporate Social ◽  
The Relationship

This paper examines the relationship between corporate social responsibility and executive compensation disclosure quality. We test whether socially responsible firms disclose more transparent and detailed information about their executive compensation packages than firms that are less committed to social responsibility initiatives. Using a sample of 187 publicly listed Canadian firms, we find a positive relation between CSR and executive compensation disclosure quality. We also document a positive (negative) association between firm size (ownership concentration) and executive compensation disclosure. These findings support the conclusion that increased disclosure transparency reflects a companys social engagement towards its stakeholders.

scholarly journals Does corporate social responsibility affect earnings management? Evidence from family firms

2019 ◽  
Vol 22 (2) ◽  
pp. 233-247
Author(s):  
Eva López-González ◽  
Jennifer Martinez-Ferrero ◽  
Emma García-Meca
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Family Firms ◽  
Management Practices ◽  
Socially Responsible ◽  
Responsible Behavior ◽  
Panel Data Regression ◽  
Social And Environmental Performance ◽  
Corporate Social

The purpose of this paper is to shed light on the effect of corporate social responsibility performance on earnings management. We also examine the moderating role of family ownership on the association between earnings management and socially responsible performance. Based on an international sample of 6,442 firm-year observations from 2006 to 2014, we use several validated analysis and panel-data regression models. We find that social and environmental performance is positively related with earnings management; firms with a greater socially responsible performance show a higher discretionary behavior by promoting actions that mask the real financial and economic performance of the firm. However, we find that this positive relation is lower – moderated - in family-owned firms, mainly because of the fact that family firms show a greater socially responsible behavior aimed to preserve their socioemotional endowments and are negatively associated with earnings management practices.; El objetivo de este artículo es intentar aclarar el efecto de la responsabilidad social corporativa en la manipulación de información. También examinamos el efecto moderador de la familia en la relación entre manipulación de información y responsabilidad corporativa. Basados en una muestra internacional de 6,442 observaciones empresa-año durante los años 2006-2014, usamos análisis de validez y modelos de regresión para datos de panel. Hemos concluido que el desarrollo social y ambiental está positivamente relacionado con la manipulación de información; las empresas con una mayor actividad de responsabilidad social muestran un mayor comportamiento de manipulación a través de la promoción de acciones que enmascaran la realidad financiera y económica de la sociedad. Igualmente, encontramos que esta relación positiva es moderada a la baja en empresas familiares, principalmente porque las empresas familiares muestran una mayor responsabilidad social pues están centradas en conservar sus legados emocionales y así mismo están negativamente asociadas con prácticas relativas a la manipulación de información.

Corporate social responsibility, firm performance and the moderating effect of earnings management in Chinese firms

2018 ◽  
Vol 10 (2/3) ◽  
pp. 184-199 ◽  
Author(s):  
Muhammad Safdar Sial ◽  
Zheng Chunmei ◽  
Tehmina Khan ◽  
Vinh Khuong Nguyen
Keyword(s):  
Corporate Social Responsibility ◽  
Firm Performance ◽  
Social Responsibility ◽  
Earnings Management ◽  
Generalized Method Of Moments ◽  
Chinese Firms ◽  
Content Type ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to examine the relationship between corporate social responsibility (CSR) and firm performance and the moderating role of earnings management on the relationship between CSR and firm performance. Design/methodology/approach The empirical study used the updated data set (3,481 unbalanced observations for period 2009–2015) from Chinese listed companies on Shenzhen and Shanghai stock exchanges. The generalized method of moments (GMM) statistical approach has been used for the analysis. The authors utilized STATA to test GMM on a sample of Chinese listed firms data over the period 2009–2015. The unbalanced sample obtained 3,481 observations from China stock market and accounting research database and CSR ratings provided by Rankins (RKS). Findings The results demonstrated that CSR has a positive and significant relationship with firm’s performance; also, earnings management has a negatively moderate relationship between CSR and firm performance. These results imply that a high value of earnings management, which results in high level of symbolic CSR, converts to low firm performance of the Chinese firms. CSR actions (only as symbolic measures) promoted by managers as a means to cover their profit management incite an adverse effect on the company’s performance. This study has highlighted the impact of two different corporate social responsibilities: substantive and symbolic (genuine CSR vs greenwashing) on firm performance. Research limitations/implications The results of this investigation will be of distinct interest to company owners who wish to ascertain the effectiveness of the sustainability decisions of directors and managers, and also to investors and public authorities to estimate the positive relationship between CSR and company’s reputation and image, and thus, the positive influence on firm performance. Originality/value Previous studies have generally focused on the relationship between CSR and firm performance. This study provides the impact of earnings management (measurement of both aspects of accrual-based earnings management and real earnings management) on this relationship. Furthermore, this study examines the state of CSR in the Chinese market and provides empirical evidence of this relationship in emerging markets.

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