Corporate social responsibility and credit risk

Christina Bannier, Yannik Bofinger and Björn Rock

Finance Research Letters, 2022, vol. 44, issue C

Abstract: We study the relationship between corporate social responsibility and credit risk for U.S. and European firms over the period 2003 to 2018. Differentiating between the various facets of corporate social responsibility shows that only environmental aspects are negatively related with various measures of credit risk for U.S. firms. For European firms, both environmental and social aspects are negatively associated with credit risk. Surprisingly, we find that credit ratings do not reflect the same contemporaneous relationship with corporate social responsibility. Our results are robust against different estimation methods.

Keywords: Corporate social responsibility; ESG; Sustainability; Credit risk; Credit rating (search for similar items in EconPapers)
JEL-codes: G11 G32 G34 O16 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:44:y:2022:i:c:s1544612321001331

DOI: 10.1016/j.frl.2021.102052

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