 Investor reaction to positive and negative corporate social eventsChristopher Groening and Vamsi Krishna Kanuri Journal of Business Research, 2013, vol. 66, issue 10, 1852-1860 Abstract: The goal of this research is to provide a basis for understanding under what circumstances there is a match (congruence) between stakeholder and investor reactions to a stakeholder-positive corporate social event (pCSE) and a stakeholder-negative corporate social event (nCSE). Analysis of a unique dataset of more than 1000 pCSEs (e.g., addition of strong retirement benefits for employees) and nCSEs (e.g., employee health and safety concerns) reveals that nearly half of the time, congruence is violated (e.g., pCSE results in a negative return, or nCSE leads to a positive return). The results reflect whether investors believe a CSE is revenue enhancing or an opportunity cost. In other words, there are situations when a stakeholder group views a firm pCSE in a positive light, but investors may not reward the firm, and may even mete out punishment At the same time, there are situations when a firm that faces an nCSE that is viewed negatively by a stakeholder group, may not only receive a non-negative reaction from investors, but also in some cases may be rewarded by investors. Keywords: Corporate social responsibility; Event study; Abnormal returns; Congruence; Incongruence; Stakeholder theory (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:66:y:2013:i:10:p:1852-1860 DOI: 10.1016/j.jbusres.2013.02.006 Access Statistics for this article Journal of Business Research is currently edited by A. G. Woodside More articles in Journal of Business Research from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.