 Corporate social responsibility, innovation and firm valueInternational Journal of Business Governance and Ethics, 2020, vol. 14, issue 3, 271-297 Abstract: This study argues that corporate social responsibility (CSR) and firm innovation have long-term orientation and CSR is positively related to innovation. It explicitly recognises the endogeneity of CSR and innovation and uses 2SLS instrumental variable regressions to estimate the impact of CSR on innovation. Using a sample of 841 large US companies and 3,246 firm year observations for the period 1995-2006, it finds that CSR is positively associated with firm performance in innovation measured by patents and citations. Results also show that CSR strengths (concerns) have positive (negative) impact on innovation. Additional tests indicate that firm performance in innovation is positively related to industry adjusted Tobin's Q, suggesting that innovation is one of the channels through which CSR increases firm value. Overall, the empirical results indicate that CSR is a long-term strategic investment and its impact on firm value should be measured through its impact on firm innovation which is a good indicator of long-term value. Keywords: corporate social responsibility; CSR; innovation; patents; citations; firm value; agency theory; stakeholder theory. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ids:ijbget:v:14:y:2020:i:3:p:271-297 Access Statistics for this article More articles in International Journal of Business Governance and Ethics from Inderscience Enterprises Ltd |
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