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Comparing Big Givers and Small Givers: Financial Correlates of Corporate Philanthropy

Comparing Big Givers and Small Givers: Financial Correlates of Corporate Philanthropy In a departure from the traditional studies of corporate philanthropy that focus on board composition, advertising, and social networks, the authors investigate the financial correlates of corporate philanthropy. The research design controls for firm size and industry while observing firms from a variety of industries. The sample contains matched pairs of generous and less generous corporate givers. The authors find, as hypothesized, a positive relationship between a firm's cash resources available and cash donations, but no significant relationship between corporate philanthropy and firm financial performance, regardless of whether corporate philanthropy is measured as cash payouts or the aggregate contributions that charities actually receive, and regardless of whether financial performance is gauged using accounting measures or market measures. Whereas the link between available resources and corporate philanthropy is well accepted in the literature on corporate social responsibility, it has been rarely tested and never so definitively found as in this research. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Business Ethics Springer Journals

Comparing Big Givers and Small Givers: Financial Correlates of Corporate Philanthropy

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Publisher
Springer Journals
Copyright
Copyright © 2003 by Kluwer Academic Publishers
Subject
Philosophy; Ethics; Business and Management, general; Management; Business Ethics; Quality of Life Research
ISSN
0167-4544
eISSN
1573-0697
DOI
10.1023/A:1024199411807
Publisher site
See Article on Publisher Site

Abstract

In a departure from the traditional studies of corporate philanthropy that focus on board composition, advertising, and social networks, the authors investigate the financial correlates of corporate philanthropy. The research design controls for firm size and industry while observing firms from a variety of industries. The sample contains matched pairs of generous and less generous corporate givers. The authors find, as hypothesized, a positive relationship between a firm's cash resources available and cash donations, but no significant relationship between corporate philanthropy and firm financial performance, regardless of whether corporate philanthropy is measured as cash payouts or the aggregate contributions that charities actually receive, and regardless of whether financial performance is gauged using accounting measures or market measures. Whereas the link between available resources and corporate philanthropy is well accepted in the literature on corporate social responsibility, it has been rarely tested and never so definitively found as in this research.

Journal

Journal of Business EthicsSpringer Journals

Published: Oct 17, 2004

References