Corporate social responsibility disclosure and firm value: a signaling theory perspective

Nguyen Van Ha

Journal of Economics and Development, 2025, vol. 27, issue 2, 114-128

Abstract: Purpose - This study investigates the impact of corporate social responsibility (CSR) disclosure on firm value and the moderating roles of largely under-examined contextual factors such as mandatory disclosure policy, industry profile and local institutional environment. Design/methodology/approach - Panel data techniques are used to investigate the association between CSR disclosure and firm value as well as the roles of such intervening factors. Findings - The study finds that CSR disclosure is positively related to firm value, indicating the financial benefit of CSR disclosure. Moreover, the positive relationship is more pronounced in the post-mandatory CSRD period, non-high-profile industries and more favorable institutional environment. Practical implications - The study provides corporate managers with more insight into the beneficial effects of CSR disclosure and the contingency factors influencing the CSR disclosure–firm value relationship. Originality/value - This study advances the extant knowledge of contingent effects on the market valuation of CSR reporting from a signaling theory perspective. Developing a theory to explain the relationship between CSR disclosure and firm value, this study adds arguments and empirical evidence to demonstrate that the effectiveness of CSR disclosure as a signal depends on the signaler, the receiver and the signaling environment.

Keywords: Corporate social responsibility; Firm value; High-profile industry; Institutional environment; Mandatory CSR disclosure; G30; G32; G34; M14 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jedpps:jed-02-2024-0067

DOI: 10.1108/JED-02-2024-0067

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