Why do countries matter so much in corporate social performance?

Ye Cai, Carrie H. Pan and Meir Statman

Journal of Corporate Finance, 2016, vol. 41, issue C, 591-609

Abstract: Why do levels of corporate social performance (CSP) differ so much across countries? We answer this question in an examination of CSP ratings of more than 2600 companies from 36 countries. We find that firm characteristics explain very little of the variations in CSP ratings. In contrast, variations in country factors such as stages of economic development, culture, and institutions account for a significant proportion of variations in CSP ratings across countries. In particular, we find that CSP ratings are high in countries with high income-per-capita, strong civil liberties and political rights, and cultures oriented toward harmony and autonomy. Furthermore, we find that home country factors explain a smaller portion of the overall variations in CSP for multinationals and cross-listed firms than for non-multinationals and pure domestic firms, respectively.

Keywords: Corporate social performance; Culture; International analyses; Country factors (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (102)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:41:y:2016:i:c:p:591-609

DOI: 10.1016/j.jcorpfin.2016.09.004

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