Journal ArticleDOI
Corporate Social Responsibility and Financial Risk
TLDR
This paper found that socially responsible companies tend to show less diversifiable risk in their stock behavior than non-socially responsible companies, and that adoption of corporate social responsibility codes of conduct can help diminish the overall business risk of a company, and even improve its long-term risk-adjusted performance.Abstract:
While studies have called the performance of socially responsible investments competitive, many investors do not choose to invest their assets in a socially responsible fashion. Part of this reluctance may relate to reduced diversification possibilities and the risk effects of application of ethical screens to portfolios. This investigation of a sample of Canadian stocks challenges the popular opinion that socially responsible investments are more volatile than conventional portfolios. Judged by two different methodologies, socially responsible companies tend to show less diversifiable risk in their stock behavior than non-socially responsible companies. These findings seem to support social investors? view that the adoption of corporate social responsibility codes of conduct can help diminish the overall business risk of a company, and even improve its long-term risk-adjusted performance.read more
Citations
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The impact of corporate social responsibility on the cost of bank loans
Allen Goss,Gordon S. Roberts +1 more
TL;DR: The authors examined the link between corporate social responsibility (CSR) and bank debt and found that firms with social responsibility concerns pay between 7 and 18 basis points more than firms that are more responsible.
Posted Content
The Debate Over Doing Good: Corporate Social Performance, Strategic Marketing Levers, and Firm-Idiosyncratic Risk
TL;DR: In this article, the authors developed a theoretical framework that predicts the impact of corporate social performance on firm-idiosyncratic risk and the role of two strategic marketing levers, advertising and research and development (R&D), in explaining the variability of this impact among different firms.
Journal ArticleDOI
The Debate over Doing Good: Corporate Social Performance, Strategic Marketing Levers, and Firm-Idiosyncratic Risk
Xueming Luo,C. B. Bhattacharya +1 more
TL;DR: In this article, the authors developed a theoretical framework that predicts the impact of corporate social performance (CSP) on firm-idiosyncratic risk and the role of two strategic marketing levers, advertising and research and development (R&D), in explaining the variability of this impact among different firms.
Posted Content
Corporate Social Responsibility and Firm Size
TL;DR: In this article, the authors examined the different economic motivations of firms with varying combinations of visibility, resource access and scale of operations and concluded that very small and very large firms are equally motivated to participate in CSR.
Journal ArticleDOI
Does CSR Reduce Firm Risk? Evidence from Controversial Industry Sectors
Hoje Jo,Haejung Na +1 more
TL;DR: In this paper, the authors examine the relation between corporate social responsibility (CSR) and firm risk in controversial industry sectors and find that CSR engagement inversely affects firm risk after controlling for various firm characteristics.
References
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Journal ArticleDOI
Toward a New Conception of the Environment-Competitiveness Relationship
TL;DR: In this article, the authors argue that the trade-off between environmental regulation and competitiveness unnecessarily raises costs and slows down environmental progress, and that instead of simply adding to cost, properly crafted environmental standards can trigger innovation offsets, allowing companies to improve their resource productivity.
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Corporate Social Responsibility and Firm Financial Performance
TL;DR: This paper analyzed the relationship between perceptions of firms' corporate social responsibility and measures of their financial performance and found that a firm's prior performance, assessed by both stock-market returns and accounting-based measures, is more closely related to corporate social concern than is subsequent performance.
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Another Puzzle: The Growth in Actively Managed Mutual Funds
TL;DR: In this article, the authors present empirical evidence that investors in actively managed mutual funds may have been more rational than we have assumed, and show that the return on new cash flows should be better than the average return for all investors in these funds.
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An Empirical Examination of the Relationship between Corporate Social Responsibility and Profitability
TL;DR: Although there has been considerable research into the relationship between corporate social responsibility and profitability, it has frequently reflected either an ideological bias or limited meth... as discussed by the authors, it has often reflected either a bias or a limited meth
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Have Individual Stocks Become More Volatile? An Empirical Exploration of Idiosyncratic Risk
TL;DR: In this paper, the authors used a disaggregated approach to study the volatility of common stocks at the market, industry, and firm levels and found that over the period from 1962 to 1997 there has been a noticeable increase in firm-level volatility relative to market volatility.