Investment Horizon and Corporate Social Performance: The Virtuous Circle of Long-Term Institutional Ownership and Responsible Firm Conduct

Ioannis Oikonomou, Chao Yin () and Lei Zhao ()
Additional contact information
Chao Yin: ICMA Centre, Henley Business School, University of Reading
Lei Zhao: ESCP Europe Business School, Paris

ICMA Centre Discussion Papers in Finance from Henley Business School, University of Reading

Abstract: We investigate the relationship between corporate social performance and institutional ownership. We distinguish between long-term and short-term institutional investors using holdings-based measures which directly capture the investment horizon of each institution. Our analysis shows that long term institutional investment is positively related to corporate social performance (mainly by an avoidance of investing in firms with significant controversies) whereas short-term institutional investment is negatively related to corporate social performance. Further investigation reveals that increased holdings of a firm by long-term investors are positively associated with its future corporate social performance. Hence, we provide evidence of a 'virtuous circle' between long term investment and social responsibility.

Keywords: corporate social responsibility; CSR; CSP; sustainability; institutional investors; investment horizon (search for similar items in EconPapers)
JEL-codes: G23 G31 M14 (search for similar items in EconPapers)
Date: 2017-10
New Economics Papers: this item is included in nep-cfn
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://s3-eu-west-1.amazonaws.com/assets.henley.a ... -Oikonomou-et-al.pdf (application/pdf)

Related works:
Journal Article: Investment horizon and corporate social performance: the virtuous circle of long-term institutional ownership and responsible firm conduct (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rdg:icmadp:icma-dp2017-06

Access Statistics for this paper

More papers in ICMA Centre Discussion Papers in Finance from Henley Business School, University of Reading Contact information at EDIRC.
Bibliographic data for series maintained by Marie Pearson ().