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Corporate social responsibility as a strategic shield against costs of earnings management practices

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Corporate social responsibility as a strategic shield against costs of earnings management practices. / Martínez Ferrero, Jennifer ; Banerjee, Shantanu; María García Sánchez, Isabel .

In: Journal of Business Ethics, Vol. 133, No. 2, 01.2016, p. 305-324.

Research output: Contribution to journalJournal articlepeer-review

Harvard

Martínez Ferrero, J, Banerjee, S & María García Sánchez, I 2016, 'Corporate social responsibility as a strategic shield against costs of earnings management practices', Journal of Business Ethics, vol. 133, no. 2, pp. 305-324. https://doi.org/10.1007/s10551-014-2399-x

APA

Martínez Ferrero, J., Banerjee, S., & María García Sánchez, I. (2016). Corporate social responsibility as a strategic shield against costs of earnings management practices. Journal of Business Ethics, 133(2), 305-324. https://doi.org/10.1007/s10551-014-2399-x

Vancouver

Martínez Ferrero J, Banerjee S, María García Sánchez I. Corporate social responsibility as a strategic shield against costs of earnings management practices. Journal of Business Ethics. 2016 Jan;133(2):305-324. https://doi.org/10.1007/s10551-014-2399-x

Author

Martínez Ferrero, Jennifer ; Banerjee, Shantanu ; María García Sánchez, Isabel . / Corporate social responsibility as a strategic shield against costs of earnings management practices. In: Journal of Business Ethics. 2016 ; Vol. 133, No. 2. pp. 305-324.

Bibtex

@article{6466b3014bf14bfea414fa8dde6405f4,
title = "Corporate social responsibility as a strategic shield against costs of earnings management practices",
abstract = "We highlight how Corporate Social Responsibility (CSR) can be strategically used against the negative perception from earnings management (EM). Using international data, we analyse the effect of CSR and EM on the cost of capital and corporate reputation. Results confirm that CSR strategy is positively valued by investors and other stakeholders. Contrary to EM, CSR has a positive effect on corporate reputation and lowers the cost of capital. In addition, we also find that the favorable effect of CSR on cost of capital is consistently more intense in firms that show signs of EM indicating that the market does not identify when CSR practices are used as a strategy to mask EM. We also demonstrate how institutional factors influence the above relationship. ",
author = "{Mart{\'i}nez Ferrero}, Jennifer and Shantanu Banerjee and {Mar{\'i}a Garc{\'i}a S{\'a}nchez}, Isabel",
note = "The final publication is available at Springer via http://dx.doi.org/10.1007/s10551-014-2399-x",
year = "2016",
month = jan,
doi = "10.1007/s10551-014-2399-x",
language = "English",
volume = "133",
pages = "305--324",
journal = "Journal of Business Ethics",
issn = "0167-4544",
publisher = "Springer Netherlands",
number = "2",

}

RIS

TY - JOUR

T1 - Corporate social responsibility as a strategic shield against costs of earnings management practices

AU - Martínez Ferrero, Jennifer

AU - Banerjee, Shantanu

AU - María García Sánchez, Isabel

N1 - The final publication is available at Springer via http://dx.doi.org/10.1007/s10551-014-2399-x

PY - 2016/1

Y1 - 2016/1

N2 - We highlight how Corporate Social Responsibility (CSR) can be strategically used against the negative perception from earnings management (EM). Using international data, we analyse the effect of CSR and EM on the cost of capital and corporate reputation. Results confirm that CSR strategy is positively valued by investors and other stakeholders. Contrary to EM, CSR has a positive effect on corporate reputation and lowers the cost of capital. In addition, we also find that the favorable effect of CSR on cost of capital is consistently more intense in firms that show signs of EM indicating that the market does not identify when CSR practices are used as a strategy to mask EM. We also demonstrate how institutional factors influence the above relationship.

AB - We highlight how Corporate Social Responsibility (CSR) can be strategically used against the negative perception from earnings management (EM). Using international data, we analyse the effect of CSR and EM on the cost of capital and corporate reputation. Results confirm that CSR strategy is positively valued by investors and other stakeholders. Contrary to EM, CSR has a positive effect on corporate reputation and lowers the cost of capital. In addition, we also find that the favorable effect of CSR on cost of capital is consistently more intense in firms that show signs of EM indicating that the market does not identify when CSR practices are used as a strategy to mask EM. We also demonstrate how institutional factors influence the above relationship.

U2 - 10.1007/s10551-014-2399-x

DO - 10.1007/s10551-014-2399-x

M3 - Journal article

VL - 133

SP - 305

EP - 324

JO - Journal of Business Ethics

JF - Journal of Business Ethics

SN - 0167-4544

IS - 2

ER -