CEO compensation and corporate social responsibility

Ming Jian and Kin-Wai Lee

Journal of Multinational Financial Management, 2015, vol. 29, issue C, 46-65

Abstract: We examine the association between CEO compensation and corporate social responsibility (CSR). We find that CEO compensation is negatively associated with CSR investment. We find CEO compensation is positively associated with normal CSR, suggesting that CEO is rewarded for investing in optimal level of CSR. The positive association between CEO compensation and normal CSR is more pronounced in firms with stronger corporate governance. However, CEO compensation level is negatively associated with abnormal CSR, suggesting that when CSR investment deviates from its optimal level, CEOs receive lower compensation level for excessive CSR investments. Firms with good corporate governance penalize abnormal CSR.

Keywords: Corporate social responsibility (CSR); CEO compensation; Corporate governance (search for similar items in EconPapers)
JEL-codes: G30 G34 M1 M2 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (30)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:mulfin:v:29:y:2015:i:c:p:46-65

DOI: 10.1016/j.mulfin.2014.11.004

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