Corporate sustainability and risk

Gramlich, Dieter; Finster, Nicole

doi:10.1007/s11573-013-0666-4

Cited by 30 publications

(22 citation statements)

References 27 publications

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“…Secondly, the multiplicity of data and methodologies used can explain the inconsistent empirical results observed. Specifically, a problem of endogeneity exists between CSR and CFP variables, and the strength of the link between financial and CSR performances depends on the way they are measured, as well as numerous moderating variables (Orlitzky 2013;Gramlich and Finster 2013).…”

Section: The Relationship Between Corporate Governance Csr and Corporate Financial Performancementioning

confidence: 99%

Corporate social responsibility and governance

2019

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Section: The Relationship Between Corporate Governance Csr and Corporate Financial Performancementioning

confidence: 99%

Corporate social responsibility and governance

2019

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“…Similarly, the corporate governance structure may affect the cost of equity (Feng et al , 2015). Evidence by Gramlich and Finster (2013) suggests that the level of corporate sustainability influences the financial risk for companies. A possible explanation may be that firms in coordinated market economies show a higher degree of ownership concentration, and banks being the fundamental source of financing and performing the monitoring, thus, have a different demand for sustainability reporting (Mietzner et al , 2011).…”

Section: Resultsmentioning

confidence: 99%

Tax avoidance, value creation and CSR – a European perspective

Kiesewetter

Manthey

2017

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Purpose This paper aims to answer how corporate governance and corporate social responsibility (“CSR”) affect the relationship between value creation and tax avoidance. This study further analyses the impact of the institutional environment, i.e. whether a country is rather a liberal or a coordinated market economy, on the relationship between CSR and tax avoidance. Design/methodology/approach The empirical analysis comprises a panel data set of 7,924 observations for the years from 2005 to 2014 for European companies. The relationship between value creation and tax avoidance is tested by grouping the sample in high and low CSR performers. Similarly, the impact of the type of market economy is analysed for the firms. Findings The research design does not find evidence that tax avoidance is creating value. The empirical findings reveal that there is a positive relationship between value creation and the effective tax rate for firms with low social and environmental characteristics. Further, this analysis could show that stronger corporate governance is associated with a lower effective tax rate in both coordinated and liberal market economies. The analysis identifies social strengths being associated with a higher effective tax rate for coordinated market economies. Practical implications It is proposed to encourage CSR disclosure. The creation of incentives for social strengths could increase tax revenue. Firms should reconsider whether the engagement in tax avoidance is worth it and pursue social responsibility to achieve higher value creation for their stakeholders. Originality/value The paper challenges the intuitive expectation that tax avoidance creates value. It is suggested that the governance and CSR culture, as well as the tax legislation in Europe, is different to the USA. Conclusively, tax avoidance is not generating value for the European sample.

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“…This lack of consistency in the results may be explained by the multiplicity of data and methodologies used among studies. Especially, the strength of the link between financial and CSR performances depends on the way the two performances are measured and numerous moderating variables (Gramlich and Finster 2013). With support from the above-mentioned meta-analyses and additional ones cited below, we review the methods used in previous studies leading to significant results and summarize our findings below.…”

Section: Measuring the Financial And Csr Performancesmentioning

confidence: 89%

ESG Impact on Market Performance of Firms: International Evidence

Sahut

Pasquini-Descomps

2015

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This study investigates how news-based scores in ESG (Environmental, Social, and corporate Governance) may have influenced the monthly stocks’ market return in Switzerland, the US, and the UK during the 2007–2011 period. We find that the variation of the overall ESG score is only significant in the UK. We also show that the changes in sub-category ratings of GRI (namely, governance, economic, environment, labor, human rights, society, and products) exhibit a small but significant impact on the stock’s performance during limited periods or on limited sectors, which varies among the countries. Finally, our non-parametric kernel regression highlights that the function linking a stock’s performance to its ESG-score changes is probably non-linear.Cette étude examine dans quelle mesure les informations ESG (Environnement, Social et Gouvernance d’entreprise), agrégées sous forme de scores, peuvent influencer les rendements mensuels des actions sur les marchés en Suisse, aux États-Unis, et au Royaume-Uni, au cours de la période 2007-2011. Nous constatons que la variation de la note globale ESG n’est significative qu’au Royaume-Uni. Nous montrons également que les changements dans les sous-catégories de notes du GRI (à savoir, la gouvernance, l’économie, l’environnement, le travail, les droits humains, la société et les produits) présentent un impact faible mais significatif sur la performance des actions, mais seulement sur des périodes restreintes ou pour des secteurs limités, qui varient contextuellement selon les pays. Enfin, notre régression non-paramétrique met en évidence la non-linéarité probable de la fonction reliant la performance d’une action à ses changements de score ESG.Este estudio investiga cómo las noticias basadas en puntuaciones en ESG (Enviromental, Social & Governance Index) pueden haber influido en la rentabilidad mensual de los valores de las empresas en Suiza, los EE.UU. y el Reino Unido durante el período 2007-2011. Los resultados muestran que la variación de la puntuación globalen ESG sólo es significativa en el Reino Unido. Además los resultados también muestran que los cambios de clasificación en las subcategorías (es decir, la gobernanza, la economía, el medio ambiente, el trabajo, los derechos humanos, la sociedad y los productos) presenta un pequeño pero significativo impacto en el rendimiento de las acciones durante períodos limitados o en sectores limitados, los cuales varían en los distintos países. Por último, nuestra regresión no paramétrica Kernel subraya que la función que relaciona el rendimiento en bolsa con los cambios en las puntuaciones ESG es probablemente no lineal

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Corporate sustainability and risk

Cited by 30 publications

References 27 publications

Corporate social responsibility and governance

Corporate social responsibility and governance

Tax avoidance, value creation and CSR – a European perspective

ESG Impact on Market Performance of Firms: International Evidence

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