Does CSR impact premiums in M&A transactions?

Mathieu Gomes and Sylvain Marsat

Finance Research Letters, 2018, vol. 26, issue C, 71-80

Abstract: Studies linking corporate social responsibility (CSR) to the market value of firms for marginal investors have found mixed evidence. However, the case of strategic acquirers has scarcely been analyzed. We investigate whether CSR is valued by acquirers in mergers and acquisitions (M&A) and find that CSR is positively associated with bid premiums. Interestingly, while environmental performance is generally valued by acquirers, social performance only commands a premium in cross-border transactions. Our findings suggest that acquirers value targets’ CSR involvement and may consider it as a way to reduce information asymmetry and targets’ specific risk.

Keywords: Corporate social responsibility; Mergers and acquisitions; Acquisition premium (search for similar items in EconPapers)
JEL-codes: G30 G34 M14 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (36)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:26:y:2018:i:c:p:71-80

DOI: 10.1016/j.frl.2017.12.005

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