The role of corporate governance on CSR disclosure and firm performance in a voluntary environment

Chijoke‐Mgbame, Aruoriwo Marian; Mgbame, Chijoke Oscar; Akintoye, Simisola; Ohalehi, Paschal

doi:10.1108/cg-06-2019-0184

Cited by 52 publications

(59 citation statements)

References 74 publications

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“…Mervelskemper and Streit (2017) show a significant positive effect of ESG performance on firm value, which is stronger when firms publish an ESG report. Similarly, Chijoke-Mgbame et al (2019) and Alareeni and Hamdan (2020) argue that CSR/ESG disclosure is positively associated with firm performance. Aouadi and Marsat (2018) find that market value is related to the corporate social performance score for firms with certain characteristics such as large size, better operating performance and location in countries with greater press freedom.…”

Section: Theoretical Framework and Literature Reviewmentioning

confidence: 99%

The effect of ESG on value creation from mergers and acquisitions. What changed during the COVID-19 pandemic?

Tampakoudis

Noulas

Kiosses

et al. 2021

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Purpose The purpose of this study is to investigate the relationship between environmental, social and governance (ESG) performance and shareholder wealth in the context of mergers and acquisitions (M&As) before and during the coronavirus (COVID-19) pandemic. Design/methodology/approach This paper uses a sample of 889 completed M&As announced by US firms between 1 January 2018 and 31 July 2020. Announcement abnormal returns are estimated using an event study methodology and the relation of ESG performance to shareholder value creation is tested with univariate and multivariate cross-sectional regressions. Findings This study provides evidence for a significant negative value effect of ESG performance for the shareholders of acquiring firms during the entire sample period. The negative effect appears to be stronger, as the onset of the COVID-19 crisis. This suggests that, during the pandemic-driven economic turmoil, the costs of sustainability activities outweigh any possible gains, providing evidence in support of the overinvestment hypothesis. Research limitations/implications The results of the study have important implications for firms, investors and policymakers. Firms should be more cautious with regard to extensive investments in ESG activities, particularly during economic turmoil. For shareholders, the results suggest that ESG engagement is not a resilience factor in an exogenous shock such as the COVID-19 pandemic. In terms of policymaking, the sustainability disclosure framework should remain voluntary allowing firms to report material ESG-related issues. The main limitation of the study is related to data availability regarding ESG performance. Originality/value To the best of the knowledge, this is the first study that investigates the effect of ESG performance on shareholder value in the market for corporate control before and during the COVID-19 pandemic.

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Section: Theoretical Framework and Literature Reviewmentioning

confidence: 99%

The effect of ESG on value creation from mergers and acquisitions. What changed during the COVID-19 pandemic?

Tampakoudis

Noulas

Kiosses

et al. 2021

View full text Add to dashboard Cite

show abstract

“…Scholars have started to debate the issue of eventual government support to cover firms' liquidity shortages. Businesses have been seen traditionally as profit-driven economic players while governments are perceived as being political actors encumbered with the responsibility of societal development (Chijoke-Mgbame et al, 2020). The coronavirus pandemic has contributed to our recognition of companies' dependence on the wider environment, including governmental support.…”

Section: Financial Sources and Company Performance Under Covid-19 Conditionsmentioning

confidence: 99%

“…The financial variables drawn from the literature on capital structure include: number of weeks a firm will be able to remain open if its sales cease; equity being the main source of finance; loans being the main source of finance; and national or local government financial support in response to the crisis. Inclusion of country-specific factors has been inspired by institutional theory and its importance for corporate governance (Chijoke-Mgbame et al, 2020). Additionally, early studies on COVID-19 suggest the unprecedented importance of macro-economic and institutional factors for company performance (Al-Awadhi et al, 2020;Sohrabi et al, 2020;Jinjarak et al, 2020).…”

Section: Variables and Their Definitionsmentioning

confidence: 99%

Firms’ performance during the COVID-19 outbreak: international evidence from 13 countries

Golubeva

2021

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Purpose The purpose of this paper is to explore the impact of firm-, finance- and country-specific indicators to the performance of companies under the COVID-19 outbreak. Design/methodology/approach The study uses a regression performance model for enterprises during the COVID-19 crisis. The investigation is based upon a data set of 5,730 firms from 13 countries collected by the World Bank through enterprise surveys. The author combined the analysis of traditional performance measurements with the testing of relatively novel variables. Findings This study confirms the significance of multiple factors for company performance: sector, size, participation in exports and market demand for firms’ products. Robust financing solutions during the coronavirus pandemic period include equity contributions, followed by firms’ cash balances and debt. Support by a government, however, has not yet been confirmed as a significant source of finance. This paper also suggests the importance of country-specific factors for the performance of enterprises, including the level of economic development and the corporate governance infrastructure. Practical implications The research outcomes might assist regulatory bodies, policymakers and companies in their formulation of public and corporate governance strategies concerning future emergency preparedness and responses. Originality/value This paper is among the first empirical studies in the management realm that addresses the impact of COVID-19 on company performance, with cross-national empirical data.

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“…Broad environmental protection, active measures to respect human rights and improve the working environment, the fight against corruption – many Swedish companies are now at the forefront of integrating a sustainability approach into their strategies and day-to-day management. As a result, Sweden sets an example of social responsibility (Linde and Erlingsson, 2013; Chijoke-Mgbame et al , 2019).…”

Section: Literature Review and Research Hypothesesmentioning

confidence: 99%

Corporate social responsibility and financial performance: bidirectional relationship and mediating effect of customer loyalty: investigation in Sweden

Hichri

Ltifi

2021

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Purpose The study is based on a hybrid model composed of accounting and business data and is amongst the first to test the impact of corporate social responsibility (CSR) performance on the financial performance of the company, as well as the impact of financial performance on CSR performance. The bidirectional logic chosen by the study is rarely adopted in the global context and has never been tested in the Swedish context. Moreover, the purpose of this paper is to test the mediating effect of customer loyalty on the company’s CSR performance-financial performance relationship to assess this effect over the long term. This design has been neglected in previous studies. Design/methodology/approach Data was collected from a sample of 110 Swedish companies during the period 2009–2019. This study collects the data from the Thomson Reuters Eikon database. A multiple regression analysis was performed to test the hypotheses. Findings The results confirmed the bidirectional relationship between CSR performance and company financial performance. This means that CSR performance positively influences the company’s financial performance. Similarly, financial performance positively influences the company’s CSR performance. Moreover, customer loyalty has a positive and significant mediating effect on the company’s CSR performance-financial performance relationship. Originality/value This study adds several inputs. The first contribution of the research is to test a hybrid model composed of accounting and commercial data. This model is amongst the first to test the impact of CSR performance on the financial performance of the company and the impact of financial performance on CSR performance. The second contribution is the bidirectional logic chosen by the study which is rarely adopted in the global context and has never been tested in the Swedish context. The third contribution is to test the mediating effect of customer loyalty on the company’s CSR performance-financial performance relationship to assess this effect over the long term. This design has been neglected in previous studies. The fourth contribution is the choice of the field of investigation for the reliability of the data used and the generalisation of the results obtained.

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The role of corporate governance on CSR disclosure and firm performance in a voluntary environment

Cited by 52 publications

References 74 publications

The effect of ESG on value creation from mergers and acquisitions. What changed during the COVID-19 pandemic?

The effect of ESG on value creation from mergers and acquisitions. What changed during the COVID-19 pandemic?

Firms’ performance during the COVID-19 outbreak: international evidence from 13 countries

Corporate social responsibility and financial performance: bidirectional relationship and mediating effect of customer loyalty: investigation in Sweden

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