Most theorizing on the relationship between corporate social/environmental performance (CSP) and corporate financial performance (CFP) assumes that the current evidence is too fractured or too variable to draw any generalizable conclusions. With this integrative, quantitative study, we intend to show that the mainstream claim that we have little generalizable knowledge about CSP and CFP is built on shaky grounds. Providing a methodologically more rigorous review than previous efforts, we conduct a meta-analysis of 52 studies (which represent the population of prior quantitative inquiry) yielding a total sample size of 33,878 observations. The meta-analytic findings suggest that corporate virtue in the form of social responsibility and, to a lesser extent, environmental responsibility is likely to pay off, although the operationalizations of CSP and CFP also moderate the positive association. For example, CSP appears to be more highly correlated with accounting-based measures of CFP than with market-based ...

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Corporate Social and Financial Performance: A Meta-Analysis

Companies are increasingly asked to provide innovative solutions to deep-seated problems of human misery, even as economic theory instructs managers to focus on maximizing their shareholders' wealt

Misery Loves Companies: Rethinking Social Initiatives by Business:

Social Psychology of Organizations

The paper examines the impact of ownership structure on company economic performance in 435 of the largest European companies. Controlling for industry, capital structure and nation effects we find a positive effect of ownership concentration on shareholder value (market -to- book value of equity) and profitability (asset returns), but the effect levels off for high ownership shares. Furthermore we propose and support the hypothesis that the identity of large owners—family, bank, institutional investor, government, and other companies—has important implications for corporate strategy and performance. For example, compared to other owner identities, financial investor ownership is found to be associated with higher shareholder value and profitability, but lower sales growth. The effect of ownership concentration is also found to depend on owner identity.

Ownership structure and economic performance in the largest european companies

The article explores the nature of corporate citizenship and its relevance for marketing practitioners and academic researchers. Specifically, a conceptualization and operationalization of corporate citizenship are first proposed. Then, an empirical investigation conducted in two independent samples examines whether components of an organization’s culture affect the level of commitment to corporate citizenship and whether corporate citizenship is conducive to business benefits. Survey results suggest that market-oriented cultures as well as humanistic cultures lead to proactive corporate citizenship, which in turn is associated with improved levels of employee commitment, customer loyalty, and business performance. The results point to corporate citizenship as a potentially fruitful business practice both in terms of internal and external marketing.

https://danielsethics.mgt.unm.edu/pdf/Corporate%20Citizenship.pdf

Corporate Citizenship: Cultural Antecedents and Business Benefits

An ongoing argument in financial management has been how to craft a capital structure which maximizes shareholder wealth. This question has gained prominence within the strategic management field because of the apparent link between capital structure and the ability of firms to compete. By integrating models from organizational economics with the strategic management literature, we are able to theorize that a firm’s capital structure is influenced by environmental dynamism, and that the match between environmental dynamism and capital structure is associated with superior economic performance. Our large-scale empirical analyses provide supportive evidence for the proposition that competitive environments moderate the relationship between capital structure and economic performance. From a theoretical standpoint, these findings provide another link between capital structure and corporate strategy. More importantly, we are able to move the discussion beyond the limitations of financial risk and incorporate the strategy concept of decision making under uncertainty. For practical application, these findings offer informed advice for managers on how to craft a capital structure. Copyright © 2000 John Wiley & Sons, Ltd.

Environmental dynamism, capital structure and performance: a theoretical integration and an empirical test

Agency theory posits a positive relationship between insider ownership and organizational performance. Past empirical studies examining this issue have not firmly established this relationship. The current study postulates and tests the moderating effect of environmental dynamism on the insider ownership and performance nexus. Implications and future research directions are considered. © 1998 John Wiley & Sons, Ltd.

The moderating effect of environmental dynamism on the ownership and performance relationship

This paper attempts to cross the disciplinary boundaries of strategic management and social issues management to demonstrate the relationship between managerial characteristics and corporate social performance (CSP). Drawing on studies in strategic leadership research we develop and test hypotheses about linkages between top management attributes and different levels of CSP. Our results add credence to the argument that organizations are a reflection of their top managers, and encourage further systematic research of the influence of key executives in developing and implementing socially responsible policies and programs.

The chief executive officer and corporate social performance: An interdisciplinary examination

Heeding the call for the study of the internal determinants of an organization's social responsiveness, this paper explores the role and impact of top managers on social performance. By building on...

Internal determinants of corporate social performance: the role of top managers.

Innovation is at the heart of firm success in today's competitive environment. Those factors contributing to successful innovation efforts should be important topics of research. In this study we formulated hypotheses linking the interaction between environmental dynamism and capital structure with firm innovation. Using U.S. firms as our research setting, we show that for firms in environments characterized as highly dynamic, high levels of debt are negatively related to innovation, and in stable environments, high levels of debt are positively related to innovation. Contributions, practical implications, and future extensions are considered.

Roy L. Simerly

Papers

Environmental dynamism, capital structure and performance: a theoretical integration and an empirical test

The moderating effect of environmental dynamism on the ownership and performance relationship

The chief executive officer and corporate social performance: An interdisciplinary examination

Internal determinants of corporate social performance: the role of top managers.

Environmental dynamism, capital structure and innovation: an empirical test