Institutional ownership stability and corporate social performance

Tracy Wang and Aonan Sun

MPRA Paper from University Library of Munich, Germany

Abstract: We examine the influence of institutional ownership stability on corporate social performance (CSP). We find that stable institutional ownership is associated with higher CSP, after controlling for the percentage of institutional ownership. The result is robust to alternative measures of CSP and various techniques to address endogeneity concerns. Additional analysis shows that this positive relation is driven by prudent institutional investors and by CSP dimensions directly pertinent to a specific, primary stakeholder group. Overall, we show that stable institutional investors are an effective mechanism to promote firms’ investment in long- term-oriented activities including CSR. Free Share Link provided by Elsevier (valid until May 28, 2022): https://authors.elsevier.com/a/1etOy5VD4KnC9Z

Keywords: institutional ownership stability; corporate social responsibility; corporate social performance; long-term orientation (search for similar items in EconPapers)
JEL-codes: G0 M0 (search for similar items in EconPapers)
Date: 2022-04-08
New Economics Papers: this item is included in nep-cfn
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Citations: View citations in EconPapers (6)

Published in Finance Research Letters 1544-6123.47(2022): pp. 102861

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:112679

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