Corporate social responsibility and shareholder's value

Leonardo Becchetti, Rocco Ciciretti, Iftekhar Hasan and Nada Kobeissi

Journal of Business Research, 2012, vol. 65, issue 11, 1628-1635

Abstract: Corporate social responsibility (CSR) has become one of the core components of corporate strategy and a crucial instrument to minimize conflicts with stakeholders. While corporations are busy adopting and enhancing CSR practices, the academic literature on understanding the impact of CSR is scarce, especially in the capital market. This paper traces the market reaction to corporate entry and exit from the Domini 400 Social Index, recognized as a CSR benchmark, between 1990 and 2004. The results reveal a significant negative effect on abnormal returns after exit announcements from the Domini index. The effect persists even after controlling for concurring financial distress shocks and stock market seasonality.

Keywords: Corporate social responsibility; Event study; Stock index changes (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (72)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:65:y:2012:i:11:p:1628-1635

DOI: 10.1016/j.jbusres.2011.10.022

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