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Corporate social responsibility performance communication and portfolio management

Corporate social responsibility performance communication and portfolio management <jats:sec> <jats:title content-type="abstract-subheading">Purpose</jats:title> <jats:p>The purpose of this paper is to examine the relationship between corporate social responsibility (CSR) performance communication and stocks’ performance using socially responsible investment (SRI) portfolio management approach.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Design/methodology/approach</jats:title> <jats:p>The authors used the multi-factors models to examine the impact of CSR performance communication on the <jats:italic>ex post</jats:italic> monthly returns of three distinctly formed portfolios as well as their differential performance from 2001 to 2013 in a small economy of New Zealand.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Findings</jats:title> <jats:p>The results show that SRS portfolio comprising of the stocks that demonstrate a relatively less proactive approach to the social and environmental concerns outperforms a stock portfolio that comprises of companies that have a relatively proactive approach to stakeholder engagement referred to as SVS portfolio. Furthermore, the authors’ findings show a positive relationship between social performance and market valuation. This indicates that the market values more stakeholder engagement in regard to social issues than environmental issues.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Research limitations/implications</jats:title> <jats:p>The authors’ findings imply that the SRI does make perfect financial sense in a small economy such as New Zealand. The perception of the CSR communication as an “insurance” for mitigation of social and environmental risks is one of the factors driving the valuation of SRI portfolios in New Zealand.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Originality/value</jats:title> <jats:p>The authors collected CSR data from the publicly available sources such as the annual reports, the CSR reports and sustainability reports because a layman investor is more likely to rely on these sources in a small economy.</jats:p> </jats:sec> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Managerial Finance CrossRef

Corporate social responsibility performance communication and portfolio management

Managerial Finance , Volume 43 (5): 595-613 – May 8, 2017

Corporate social responsibility performance communication and portfolio management


Abstract

<jats:sec>
<jats:title content-type="abstract-subheading">Purpose</jats:title>
<jats:p>The purpose of this paper is to examine the relationship between corporate social responsibility (CSR) performance communication and stocks’ performance using socially responsible investment (SRI) portfolio management approach.</jats:p>
</jats:sec>
<jats:sec>
<jats:title content-type="abstract-subheading">Design/methodology/approach</jats:title>
<jats:p>The authors used the multi-factors models to examine the impact of CSR performance communication on the <jats:italic>ex post</jats:italic> monthly returns of three distinctly formed portfolios as well as their differential performance from 2001 to 2013 in a small economy of New Zealand.</jats:p>
</jats:sec>
<jats:sec>
<jats:title content-type="abstract-subheading">Findings</jats:title>
<jats:p>The results show that SRS portfolio comprising of the stocks that demonstrate a relatively less proactive approach to the social and environmental concerns outperforms a stock portfolio that comprises of companies that have a relatively proactive approach to stakeholder engagement referred to as SVS portfolio. Furthermore, the authors’ findings show a positive relationship between social performance and market valuation. This indicates that the market values more stakeholder engagement in regard to social issues than environmental issues.</jats:p>
</jats:sec>
<jats:sec>
<jats:title content-type="abstract-subheading">Research limitations/implications</jats:title>
<jats:p>The authors’ findings imply that the SRI does make perfect financial sense in a small economy such as New Zealand. The perception of the CSR communication as an “insurance” for mitigation of social and environmental risks is one of the factors driving the valuation of SRI portfolios in New Zealand.</jats:p>
</jats:sec>
<jats:sec>
<jats:title content-type="abstract-subheading">Originality/value</jats:title>
<jats:p>The authors collected CSR data from the publicly available sources such as the annual reports, the CSR reports and sustainability reports because a layman investor is more likely to rely on these sources in a small economy.</jats:p>
</jats:sec>

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References (48)

Publisher
CrossRef
ISSN
0307-4358
DOI
10.1108/mf-06-2016-0164
Publisher site
See Article on Publisher Site

Abstract

<jats:sec> <jats:title content-type="abstract-subheading">Purpose</jats:title> <jats:p>The purpose of this paper is to examine the relationship between corporate social responsibility (CSR) performance communication and stocks’ performance using socially responsible investment (SRI) portfolio management approach.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Design/methodology/approach</jats:title> <jats:p>The authors used the multi-factors models to examine the impact of CSR performance communication on the <jats:italic>ex post</jats:italic> monthly returns of three distinctly formed portfolios as well as their differential performance from 2001 to 2013 in a small economy of New Zealand.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Findings</jats:title> <jats:p>The results show that SRS portfolio comprising of the stocks that demonstrate a relatively less proactive approach to the social and environmental concerns outperforms a stock portfolio that comprises of companies that have a relatively proactive approach to stakeholder engagement referred to as SVS portfolio. Furthermore, the authors’ findings show a positive relationship between social performance and market valuation. This indicates that the market values more stakeholder engagement in regard to social issues than environmental issues.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Research limitations/implications</jats:title> <jats:p>The authors’ findings imply that the SRI does make perfect financial sense in a small economy such as New Zealand. The perception of the CSR communication as an “insurance” for mitigation of social and environmental risks is one of the factors driving the valuation of SRI portfolios in New Zealand.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Originality/value</jats:title> <jats:p>The authors collected CSR data from the publicly available sources such as the annual reports, the CSR reports and sustainability reports because a layman investor is more likely to rely on these sources in a small economy.</jats:p> </jats:sec>

Journal

Managerial FinanceCrossRef

Published: May 8, 2017

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