Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

The bidirectional CSR investment – economic performance relationship

The bidirectional CSR investment – economic performance relationship Purpose – This paper aims to investigate the following two research questions: Do corporate social responsibility (CSR) investments enhance a firm’s economic performance? Does the firm’s economic performance influence CSR investments? That is, the bidirectional relationship between CSR investments and economic performance. Design/methodology/approach – This paper analyzes three types of CSR investments (environmental, labor-related and social investments) using a simultaneous equations model with a data set of 185 Japanese firms. Findings – Environmental investments reduce economic performance, labor-related investments do not significantly affect economic performance and social investments increase economic performance. Moreover, strong economic performance decreases environmental investments but increases social investments. Labor-related investments are chosen considering economic performance in both the present and previous terms. Practical implications – For managers, environmental and labor-related investments are not effective for improving economic performance. However, eradicating them completely might harm corporate reputation. In contrast, social investments have now become important. For policymakers, different approaches may be adopted to encourage firms to increase CSR investments. In some cases, policymakers can rely on firm initiatives instead of regulating or encouraging CSR activities. Originality/value – First, the authors empirically examine the bidirectional relationship between CSR investments and economic performance. Second, they clarify the determinants of CSR by specifying the investment function of each type of CSR. Third, they consider three types of CSR investments, with interrelations among them allowed in the model, and determine how each type affects firm performance. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Global Responsibility Emerald Publishing

The bidirectional CSR investment – economic performance relationship

Nakamura, Eri
Journal of Global Responsibility , Volume 6 (1): 17 – May 11, 2015
Download PDF
17 pages

Loading next page...
 
/lp/emerald-publishing/the-bidirectional-csr-investment-economic-performance-relationship-jAZmmsRu07

References (37)

Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
2041-2568
DOI
10.1108/JGR-05-2014-0021
Publisher site
See Article on Publisher Site

Abstract

Purpose – This paper aims to investigate the following two research questions: Do corporate social responsibility (CSR) investments enhance a firm’s economic performance? Does the firm’s economic performance influence CSR investments? That is, the bidirectional relationship between CSR investments and economic performance. Design/methodology/approach – This paper analyzes three types of CSR investments (environmental, labor-related and social investments) using a simultaneous equations model with a data set of 185 Japanese firms. Findings – Environmental investments reduce economic performance, labor-related investments do not significantly affect economic performance and social investments increase economic performance. Moreover, strong economic performance decreases environmental investments but increases social investments. Labor-related investments are chosen considering economic performance in both the present and previous terms. Practical implications – For managers, environmental and labor-related investments are not effective for improving economic performance. However, eradicating them completely might harm corporate reputation. In contrast, social investments have now become important. For policymakers, different approaches may be adopted to encourage firms to increase CSR investments. In some cases, policymakers can rely on firm initiatives instead of regulating or encouraging CSR activities. Originality/value – First, the authors empirically examine the bidirectional relationship between CSR investments and economic performance. Second, they clarify the determinants of CSR by specifying the investment function of each type of CSR. Third, they consider three types of CSR investments, with interrelations among them allowed in the model, and determine how each type affects firm performance.

Journal

Journal of Global Responsibility – Emerald Publishing

Published: May 11, 2015

There are no references for this article.