Corporate Social Performance and Stock Returns: UK Evidence from Disaggregate Measures

Stephen Brammer, Chris Brooks and Stephen Pavelin

Financial Management, 2006, vol. 35, issue 3, 97-116

Abstract: This study examines the relation between corporate social performance and stock returns in the UK. We closely evaluate the interactions between social and financial performance with a set of disaggregated social performance indicators for environment, employment, and community activities instead of using an aggregate measure. While scores on a composite social performance indicator are negatively related to stock returns, we find the poor financial reward offered by such firms is attributable to their good social performance on the environment and, to a lesser extent, the community aspects. Considerable abnormal returns are available from holding a portfolio of the socially least desirable stocks. These relationships between social and financial performance can be rationalized by multi‐factor models for explaining the cross‐sectional variation in returns, but not by industry effects.

Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (327)

Downloads: (external link)
https://doi.org/10.1111/j.1755-053X.2006.tb00149.x

Related works:
Journal Article: Corporate Social Performance and Stock Returns: UK Evidence from Disaggregate Measures (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:finmgt:v:35:y:2006:i:3:p:97-116

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0046-3892

Access Statistics for this article

Financial Management is currently edited by William G. Christie

More articles in Financial Management from Financial Management Association International Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().