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Peer Effects of Corporate Social Responsibility

Authors:

Hao Liang, Xintong ZhanAuthors Info & Claims

Management Science, Volume 65, Issue 12

Pages 5487 - 5503

https://doi.org/10.1287/mnsc.2018.3100

Published: 01 December 2019 Publication History

Abstract

We investigate how firms react to their product-market peers’ commitment to and adoption of corporate social responsibility (CSR) using a regression discontinuity design approach. Relying on the passage or failure of CSR proposals by a narrow margin of votes during shareholder meetings, we find the passage of a close-call CSR proposal and its implementation are followed by the adoption of similar CSR practices by peer firms. In addition, peers that have greater difficulty in catching up with the voting firm in CSR experience significantly lower stock returns around the passage, consistent with the notion that the spillover effect of the adoption of CSR is a strategic response to competitive threat. Using alternative definitions of peers and examining underlying mechanisms, we further rule out alternative explanations, such as that based on propagation by financial intermediaries.

This paper was accepted by Gustavo Manso, finance department.

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Cited By

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https://dl.acm.org/doi/10.1287/mnsc.2022.4517
Grieser WLeSage JZekhnini M(2022)Industry Networks and the Geography of Firm BehaviorManagement Science10.1287/mnsc.2021.413368:8(6163-6183)Online publication date: 1-Aug-2022
https://dl.acm.org/doi/10.1287/mnsc.2021.4133

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Peer Effects of Corporate Social Responsibility

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Information & Contributors

Information

Published In

cover image Management Science

Management Science Volume 65, Issue 12

December 2019

508 pages

ISSN:0025-1909

DOI:10.1287/mnsc.2019.65.issue-12

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Copyright © 2019, INFORMS.

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INFORMS

Linthicum, MD, United States

Publication History

Published: 01 December 2019

Accepted: 26 March 2018

Received: 12 July 2016

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Cited By

DesJardine MGrewal JViswanathan K(2023)A Rising Tide Lifts All BoatsOrganization Science10.1287/orsc.2022.162034:5(1716-1735)Online publication date: 1-Sep-2023
https://dl.acm.org/doi/10.1287/orsc.2022.1620
Huang J(2023)Thy Neighbor’s VoteManagement Science10.1287/mnsc.2022.451769:7(4169-4189)Online publication date: 1-Jul-2023
https://dl.acm.org/doi/10.1287/mnsc.2022.4517
Grieser WLeSage JZekhnini M(2022)Industry Networks and the Geography of Firm BehaviorManagement Science10.1287/mnsc.2021.413368:8(6163-6183)Online publication date: 1-Aug-2022
https://dl.acm.org/doi/10.1287/mnsc.2021.4133

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