The Impact of CSR on the Capital Structure of High-Tech Companies in Poland

Barbara Grabinska, Dorota Kedzior, Marcin Kedzior and Konrad Grabinski
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Barbara Grabinska: Department of Finance and Financial Policy, Cracow University of Economics, 31-510 Cracow, Poland
Dorota Kedzior: Department of Corporate Finance, Cracow University of Economics, 31-510 Cracow, Poland
Marcin Kedzior: Department of Financial Accounting, Cracow University of Economics, 31-510 Cracow, Poland
Konrad Grabinski: Department of Financial Accounting, Cracow University of Economics, 31-510 Cracow, Poland

Sustainability, 2021, vol. 13, issue 10, 1-20

Abstract: So far, CSR’s role in the high-tech industry is not fully explained by academic research, especially concerning the most burdensome obstacle to firms’ growth: acquiring debt financing. The paper aims to solve this puzzle and investigate whether young high-tech companies can attract more debt by engaging in CSR activity. To address the high-tech industry specificity, we divided CSR-reporting practice into three broad categories: employee, social, and environmental and analyzed their impact on the capital structure. Our sample consists of 92 firm-year observations covering the period 2014–2018. Using a regression method, we found out that only employee CSR plays a statistically significant role in shaping capital structure. We did not find evidence for the influence of the other types of CSR-reporting practices. The results suggest that employees are the key resource of high-tech companies, and, for this reason, they are at the management’s focus. This fact is visible at the financial reporting level and, as we interpret results, is also considered by credit providers. In a more general way, our results suggest that firms tend to choose CSR based on the importance of crucial resources.

Keywords: capital structure; theories of capital structure; CSR; CSR scores; R&D; high-tech companies; corporate finance; financial reporting; emerging markets; Poland (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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