Institutional ownership stability and corporate social performance

Kun Tracy Wang and Aonan Sun

Finance Research Letters, 2022, vol. 47, issue PA

Abstract: We examine the influence of institutional ownership stability on corporate social performance (CSP). We find that stable institutional ownership is associated with higher CSP, after controlling for the percentage of institutional ownership. The result is robust to alternative measures of CSP and various techniques to address endogeneity concerns. Additional analysis shows that this positive relation is driven by prudent institutional investors and by CSP dimensions directly pertinent to a specific, primary stakeholder group. Overall, we show that stable institutional investors are an effective mechanism to promote firms’ investment in long-term-oriented activities including CSR.

Keywords: Institutional ownership stability; Corporate social responsibility; Corporate social performance; Long-term orientation (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:47:y:2022:i:pa:s1544612322001507

DOI: 10.1016/j.frl.2022.102861

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