Corporate Political Activity and Sensitivity to Social Attacks: The Case of Family-Managed Firms

2020 ◽  
Vol 33 (2) ◽  
pp. 152-174
Author(s):  
James G. Combs ◽  
Richard J. Gentry ◽  
Sean Lux ◽  
Peter Jaskiewicz ◽  
T. Russell Crook
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Political Activity ◽  
Large Firms ◽  
Corporate Political Activity ◽  
Standard And Poor's ◽  
Corporate Social

Family-managed firms take actions to protect their reputations. We theorize that one such action involves avoiding corporate political activity (CPA) that expose firms to social attack, especially when also invested in corporate social responsibility. Because large firms are frequent targets for social attack, the same sensitivity that encourages most family managers to avoid CPA encourages it among the largest as a buffer. Supportive analysis of Standard and Poor’s 500 firms shows that family-managed firms spend, on average, 86% less on CPA, even less when invested in substantive corporate social responsibility. The largest invest as much or more in CPA as nonfamily peers.

Nonmarket Responses to Regulation: A Signaling Theory Approach

2020 ◽  
Vol 45 (6) ◽  
pp. 865-891
Author(s):  
Lee Warren Brown ◽  
Irene Goll ◽  
Abdul A. Rasheed ◽  
Wayne S. Crawford
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Signaling Theory ◽  
Political Activity ◽  
Theory Approach ◽  
Federal Regulations ◽  
Corporate Political Activity ◽  
The Us ◽  
Regulatory Intensity ◽  
Corporate Social

We examine how regulatory intensity and increases in regulation affect the nonmarket activities of firms. Using a signaling theory perspective, we seek to better understand how firms respond to regulation in terms of corporate social responsibility (CSR) and corporate political activity (CPA), the two main pillars of nonmarket activity. Examination of both CSR and CPA in concert rather than in isolation provides insights into whether they are complements or substitutes. We use textual analysis of the US Code of Federal Regulations to measure regulatory intensity and increases in regulation. Based on a sample of 331 S&P 500 firms for the period 1998–2014, our findings suggest that regulatory intensity leads to more nonmarket responses from firms. We also find support for nonlinear relationships between CSR and CPA.

scholarly journals Attitude and Motives Towards Corporate Social Responsibility in the Kingdom of Saudi Arabia

2018 ◽  
Vol 10 (11) ◽  
pp. 63
Author(s):  
Rawan Al Mohanna ◽  
Lama Al-Kayed
Keyword(s):  
Saudi Arabia ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Small Firms ◽  
Large Firms ◽  
Kingdom Of Saudi Arabia ◽  
Research Questions ◽  
Corporate Social ◽  
Contemporary Approach

This paper explores the attitudes of large and small firms’ managers toward Corporate Social Responsibility (CSR) in the Kingdom of Saudi Arabia and the motivations behind the implementation of such an initiative. The research revealed a gap in the minute number of studies exploring CSR practices the kingdom’s SMEs. There was a further gap in the managers’ motives towards CSR within the same region. As a way of responding to the four proposed research questions, the researchers surveyed 52 SME and large firms. Ideally, the results showed that large firms pursue traditional CSR practices and record their activities unlike SMEs, which follow a contemporary approach to CSR, with little regard to recording their activities. In addition, large firms significantly perceive CSR as an obligation, while SMEs rely on their board of management’s beliefs. This paper provides an insight for the policymakers to adopt different approaches for large and small firms in their implementation of CSR practices in pursuance of satisfactory reports.

scholarly journals Impact of Corporate Political Activity on the Relationship Between Corporate Social Responsibility and Financial Performance: A Dynamic Panel Data Approach

2018 ◽  
Vol 11 (1) ◽  
pp. 60 ◽  
Author(s):  
Woon Lin ◽  
Jo Ho ◽  
Murali Sambasivan
Keyword(s):  
Corporate Social Responsibility ◽  
Panel Data ◽  
Financial Performance ◽  
Dynamic Panel Data ◽  
Political Activity ◽  
Corporate Political Activity ◽  
Dynamic Panel ◽  
Financial Position ◽  
Corporate Social ◽  
The Relationship

As corporate social responsibility (CSR) gains momentum in the business world, it is imperative to comprehend the relationship between CSR and corporate financial performance (CFP). While there is prior research looking at this relationship, scholars have proposed a contingency view that is meant to determine the situational contexts in which critical associations between CFP and CSR activities will arise. This study provides further insight into the moderating effects of corporate political activity, specifying the ways in which different arrangements of corporate CSR and CPA might align or otherwise, thus influencing CFP beyond associated dissimilar effects on corporate performance. The data for this study was obtained for the periods 2007–2016 from the samples selected from the list of Fortune’s World’s Most Admired Companies. The dynamic panel data was analyzed using the System Generalized Method of Moment estimation. The main findings are that CSR does not significantly influence CFP. However, CPA does negatively moderate the relationship between CSR and CFP. This indicates that high political expenditures worsen a firm’s financial position compared to the financial position of firms with less spending on CPA.

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