Is venture capital socially responsible? Exploring the imprinting effect of VC funding on CSR practices

Ekin Alakent, M. Sinan Goktan and Theodore A. Khoury

Journal of Business Venturing, 2020, vol. 35, issue 3

Abstract: We study how corporate social responsibility (CSR) is guided by ownership history, specifically whether a company receives venture capital (VC) funding or not. We argue that companies that receive VC funding are less likely to adopt CSR practices due to unique VC imprinting and that temporal and investment orientation moderate this relationship. We find that VC-backed companies have poorer CSR records, which do improve over time, but at a comparatively slower rate than non-VC-backed companies. However, when VC-backed companies receive funding from VC firms that have a responsible investment orientation and a broader stakeholder view, their CSR records are significantly better. This study contributes to our understanding of imprinting boundaries and related repercussions in stakeholder management strategies.

Keywords: Venture capital; Corporate social responsibility; Imprinting; Decay; Stakeholder view; Investment orientation; Impact investment; IPO (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbvent:v:35:y:2020:i:3:s0883902617305530

DOI: 10.1016/j.jbusvent.2020.106005

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