Corporate social responsibility and firm performance: The moderation of investment horizon and corporate governance

Waheed, Abdul; Hussain, Shahzad; Hanif, Hasan; Mahmood, Hamid; Malik, Qaisar Ali

doi:10.1080/23311975.2021.1938349

Cited by 20 publications

(9 citation statements)

References 85 publications

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“…Regarding foreign IO, Lu and Abeysekera (2021) found no moderator influence on the link between CSR reporting and cumulative abnormal returns in a Chinese setting. One study also relied on the IO type (Waheed et al, 2021) in Pakistan and stressed the moderating impact of pension funds on the positive impact of social contribution value per share on Tobin's Q.…”

Section: Findings Of the Literature Reviewmentioning

confidence: 99%

Which institutional investors drive corporate sustainability? A systematic literature review

Velte

2022

Bus Strat Env

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In this article, we review recent archival research (66 studies) on the influence of institutional ownership (IO) heterogeneity on corporate sustainability. Relying on an agency-theoretical framework, we differentiate between various types of IO and their nature. We found that most prior research concentrates on the impact of IO heterogeneity on corporate sustainability performance. Long-term, sustainable, and foreign IO leads to better ESG/CSR outputs. Based on the business case argument for corporate sustainability, long-term institutional investors moderate the positive link between corporate sustainability and future financial performance. We provide useful recommendations for future research by focusing on endogeneity concerns as methodological challenges and content-related proposals for future research designs.

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Section: Findings Of the Literature Reviewmentioning

confidence: 99%

Which institutional investors drive corporate sustainability? A systematic literature review

Velte

2022

Bus Strat Env

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“…Few studies also document that companies that spend and support more on CSR activities pay off better when the companies have a better relationship with employees and shareholders (Freeman, 2010; Hansen et al, 2011; Porter & Kramer, 2002). Followed by, Waheed et al (2021) confirm that corporate social responsibility positively influences the firm performance. On the contrary, Jones (1991), Fatemi et al (2017), Lee and Park (2009), Nollet et al (2016), Orlitzky and Benjamin (2001), and Waddock and Graves (1997) document that CSR spending adversely affects the firms' financial performance.…”

Section: Introductionmentioning

confidence: 94%

Do ESG disclosures lead to superior firm performance? A method of moments panel quantile regression approach

Veeravel,

Sadharma,

Kamaiah

2023

Corp Soc Responsibility Env

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We verify the effect of ESG disclosures on firm performance using NSE 500 index listed companies spanning from 2010 to 2020. The study employs a method‐of‐moments quantile regression approach to test whether ESG disclosures lead to superior firm performance. We find evidence that environmental, social, and governance disclosures positively influence firm performance. Higher quantiles of ESG disclosures are associated with better market performance (Tobin's Q), and the same lead to lower profitability (ROA). The present study suggests that companies aspiring to improve their financial performance may pay more attention to ESG disclosure practices.

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“…Many research works have focused on the CSR-financial performance nexus, while evidence is inconclusive. Most prior studies have concluded that the higher a firm performs in CSR, the better its financial performance will be (Franco et al , 2020; Kammoun et al , 2021; Waheed et al , 2021). In this vein, Hou (2019) found that socially responsible firms benefit from superior financial performance compared to companies that do not adopt CSR initiatives.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Gender diversity, financial performance, and the moderating effect of CSR: empirical evidence from UK financial institutions

Fatma

Chouaibi

2023

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Purpose This study aims to examine the direct relationship between board gender diversity (BGD) and financial performance and the moderating role of corporate social responsibility (CSR) in the said relationship. Design/methodology/approach Using data collected from the Thomson Reuters Eikon ASSET4 database from 42 UK financial institutions listed in the ESG index for the period 2005–2019, this study used multivariate regression analysis on panel data to test the effect of BGD on financial performance and estimate the moderating effect of CSR between them. Moreover, to control the endogeneity problem, the authors conducted an additional analysis by testing the dynamic dimension of the data set through the generalized moment method. Findings The empirical results show that BGD is positively related to financial performance and that BGD increases firm performance with the moderating effect of CSR. Regarding the endogeneity problem, the existence of continuity between financial institution performances over time is demonstrated. Research limitations/implications The current paper sheds light on the importance of BGD in improving firm performance and the moderating role of CSR in strengthening the relationship between BGD and firm performance, thereby contributing to the agency theory, the resource dependency theory and the stakeholder theory. Therefore, regulators and policymakers in the UK can use the outcomes of this study to enforce the representation of female directors on boards to enhance the financial performance of financial institutions. Moreover, the findings could be useful for regulatory bodies to encourage financial institutions to practice CSR activities and disclose them in their annual reports. Originality/value To the best of the authors’ knowledge, this is the first study investigating the moderating role of CSR on the relationship between BGD and financial performance in the context of the financial sector. It is also the first study documenting that CSR reinforces the relationship between gender-diverse boards and financial institutions' performance. This study fills a research gap as it expands the existing literature that has generally focused on the impact of BGD on financial performance and has not reached similar results.

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Corporate social responsibility and firm performance: The moderation of investment horizon and corporate governance

Cited by 20 publications

References 85 publications

Which institutional investors drive corporate sustainability? A systematic literature review

Which institutional investors drive corporate sustainability? A systematic literature review

Do ESG disclosures lead to superior firm performance? A method of moments panel quantile regression approach

Gender diversity, financial performance, and the moderating effect of CSR: empirical evidence from UK financial institutions

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