Corporate Social Responsibility and Firm Risk: Evidence from Borsa Istanbul Stock Exchange

Metin Borak and Hatice Dogukanli

Journal of BRSA Banking and Financial Markets, 2022, vol. 16, issue 1, 87-106

Abstract: Corporate social responsibility (CSR) activities are expected to reduce firm risk. Because it is known that CSR activities increase financial performance and firm reputation while reducing the cost of equity and debt, and information asymmetry. This study examines the impact of corporate social responsibility on firm risk (total risk, systematic risk and unsystematic risk). The sample of the study includes companies that are traded in Borsa Istanbul and have corporate governance ratings over the period 2009–2020. Finally, the sample of the study consists of 37 companies and 339 observations. The findings show that CSR has no statistically significant effect on total, systematic and unsystematic risk. These results do not change even when one year lagged values of the explanatory variables are used.

Keywords: Corporate social responsibility; firm risk; systematic risk; unsystematic risk. (search for similar items in EconPapers)
JEL-codes: G30 G32 M14 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:bdd:journl:v:16:y:2022:i:1:p:87-106

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