Weitere Artikel dieser Ausgabe durch Wischen aufrufen
In this article, we propose that giving in cash and non-cash (in-kind) differ in their relation with the giving firm’s future corporate financial performance (CFP) and only cash giving is associated with future CFP. Using a novel dataset from ASSET4 that differentiates corporate giving over a sample period of 2002–2012, we examine three competing hypotheses: (1) agency cost hypothesis that cash giving reflects agency cost and destroys value for shareholders, (2) investment hypothesis that cash giving is an investment by management that aims for better future return, and (3) information hypothesis that cash giving has informational value to shareholders as cash is a critical resource at a firm and giving is a decision by managers who are insiders. We find that indeed, only cash giving is positively associated with future CFP and firm value, measured by Fama–French five-factor abnormal risk-adjusted stock returns, future return on assets, and Tobin’s Q. In addition, we find that the positive association exists only between excess, i.e., unexpected, but not expected cash giving and future CFP. Our empirical findings support the information hypothesis, but neither the agency hypothesis nor the investment hypothesis, and are robust to a number of endogeneity tests, including orthogonalized cash giving, instrumental variable regression using geography-based instruments, and propensity score matching. Furthermore, we show that the positive association between future CFP and unexpected cash giving is only pronounced at firms with good governance and relatively higher sales growth where agency problems are less likely, and at firms with no alternative mechanisms to demonstrate the strength of cash flow. Additionally, we do not find evidence that suggests in-kind giving to possess any informational value.
Bitte loggen Sie sich ein, um Zugang zu diesem Inhalt zu erhalten
Sie möchten Zugang zu diesem Inhalt erhalten? Dann informieren Sie sich jetzt über unsere Produkte:
Allen, F., & Michaely, R. (2003). Payout policy. Handbook of the economics of finance. Amsterdam: Elsevier.
Almeida, H., Campello, M., & Weisbach, M. (2004). The cash flow sensitivity of cash. Journal of Finance, 59, 1777–1804. CrossRef
Bae, K.-H., Kang, J.-K., & Wang, J. (2011). Employee treatment and firm leverage: A test of the stakeholder theory of capital structure. Journal of Financial Economics, 100, 130–153. CrossRef
Benabou, R., & Tirole, J. (2010). Individual and corporate social responsibility. Economica, 77(305), 1–19. CrossRef
Bettis, R. A. (1983). Modern financial theory, corporate strategy and public policy: Three conundrums. Academy of Management Review, 8(3), 406–415. CrossRef
Bhattacharya, S. (1979). Imperfect information, dividend policy and the “bird-in-hand” fallacy. Bell Journal of Economics, 10, 259–270. CrossRef
Brammer, S., & Millington, A. (2008). Does it pay to be different? An analysis of the relationship between corporate social and financial performance. Strategic Management Journal, 29, 1325–1343. CrossRef
Brown, W. O., Helland, E., & Smith, J. (2006). Corporate philanthropic practices. Journal of Corporate Finance, 12(5), 855–877. CrossRef
Carhart, M. (1997). On persistence in mutual fund performance. Journal of Finance, 52, 57–82. CrossRef
CECP. 2005–2013 edition. Giving in Numbers.
Chang, K., Kim, I., & Li, Y. (2014). The heterogeneous impact of corporate social responsibility activities that target different stakeholders. Journal of Business Ethics, 125, 211–234. CrossRef
Chen, Y. R., & Chuang, W. T. (2009). Alignment or entrenchment? Corporate governance and cash holding in growing firms. Journal of Business Research, 62(11), 1200–1206. CrossRef
Cheng, B., Ioannou, I., & Serafeim, G. (2014). Corporate social responsibility and access to finance. Strategic Management Journal, 35(1), 1–23. CrossRef
Chung, K. H., & Jo, H. (1996). The impact of security analysts’ monitoring and marketing functions on the market value of firms. Journal of Financial and Quantitative Analysis, 31(4), 493–512. CrossRef
Chung, K. H., & Pruitt, S. W. (1994). A simple approximation of Tobin’s Q. Financial Management, 23, 70–74. CrossRef
Cochran, P., & Wood, R. (1984). Corporate social responsibility and financial performance. Academy of Management Journal, 27, 42–56.
Dann, L. Y., Masulis, R., & Mayers, D. (1991). Repurchase tender offers and earnings information. Journal of Accounting and Economics, 14, 217–251. CrossRef
DeFond, M., Erkens, D., & Zhang, J. (2016). Does PSM really eliminate Big N audit quality effect? Working paper. University of Southern California.
Elton, E., Gruber, M., Das, S., & Hlabkar, M. (1993). Efficiency with costly information: A reinterpretation of evidence from managed portfolio. Review of Financial Studies, 6(1), 1–22. CrossRef
Fama, E., & French, K. (1993). Common risk factors in the returns on stocks and bonds. Journal of Financial Economics, 33(1), 3–56. CrossRef
Fama, E., & French, K. (1997). Industry costs of equity. Journal of Financial Economics, 43, 153–197. CrossRef
File, K. M., & Prince, R. A. (1998). Cause related marketing and corporate philanthropy in the privately held enterprise. Journal of Business Ethics, 17, 1529–1539. CrossRef
Fisman, R., Heal, G., & Nair, V. (2008). A model of corporate philanthropy. Working paper. Columbia University.
Fombrun, C. (1996). Reputation. Boston, MA: Harvard Business School Press.
Friedman, M. (1970). The social responsibility of business is to increase profit. New York Times Magazine (September), 13–33.
Galaskiewicz, J., & Burt, R. S. (1991). Interorganization contagion in corporate philanthropy. Administrative Science Quarterly, 36, 88–105. CrossRef
Gardberg, N. A., & Formbrun, C. J. (2006). Corporate citizenship: Creating intangible assets across institutional environments. Academy of Management Review, 31(2), 329–346. CrossRef
Gautier, A., & Pache, A. (2015). Research on corporate philanthropy: A review and assessment. Journal of Business Ethics, 126, 343–369. CrossRef
Godfrey, P. (2005). The relationship between corporate philanthropy and shareholder wealth: A risk management perspective. Academy of Management Review, 30(4), 777–798. CrossRef
Godfrey, P. C., Merrill, C. B., & Hansen, J. M. (2009). The relationship between corporate social responsibility and shareholder value: An empirical test of the risk management hypothesis. Strategic Management Journal, 30(4), 425–445. CrossRef
Greening, D., & Turvan, D. (2000). Corporate social performance as a competitive advantage in attracting quality workforce. Business and Society, 39, 254–280. CrossRef
Griliches, Z. (1979). Issues in assessing the contribution of research and development to productivity growth. Bell Journal of Economics, 10(1), 92–116. CrossRef
Guay, W., & Harford, J. (2000). The cash-flow permanence and information content of dividend increases versus repurchases. Journal of Financial Economics, 57, 385–415. CrossRef
Haley, U. (1991). Corporate contributions as managerial masques: Reframing corporate contributions as strategies to influence society. Journal of Management Studies, 28, 485–509. CrossRef
Heckman, J. J., Ichimura, H., & Todd, P. E. (1997). Matching as an econometric evaluation estimator: Evidence from evaluating a job training program. Review of Economic Studies, 64, 605–654. CrossRef
Heckman, J. J., Ichimura, H., & Todd, P. E. (1998). Matching as an econometric evaluation estimator. Review of Economic Studies, 65, 261–294. CrossRef
Hillman, A. J., & Keim, G. D. (2001). Shareholder value, stakeholder management, and social issues: What’s the bottom line? Strategic Management Journal, 22(2), 125–139. CrossRef
Jayachandran, S., Kalaignanam, K., & Eilert, M. (2013). Product and environment social performance: Varying effect on firm performance. Strategic Management Journal, 34, 1255–1264. CrossRef
Jensen, M. (1986). Agency costs of free cash flow, corporate finance and takeover. American Economic Review, 26, 323–329.
Jensen, M., & Meckling, W. (1976). Theory of firm: Managerial behavior, agency costs, and ownership structure. Journal of Financial Economics, 3(4), 305–360. CrossRef
Jiraporn, P., Jiraporn, N., Boeprasert, A., & Chang, K. (2014). Does corporate social responsibility (CSR) improve credit ratings? Evidence from geographic identification. Financial Management, 43(3), 505–531. CrossRef
Jo, H., & Harjoto, M. (2011). Corporate governance and firm value: The impact of corporate social responsibility. Journal of Business Ethics, 103(3), 351–383. CrossRef
Jo, H., & Harjoto, M. A. (2012). The causal effect of corporate governance on corporate social responsibility. Journal of Business Ethics, 106, 53–72. CrossRef
Kor, Y. Y., & Mahoney, J. T. (2005). How dynamics, management and governance of resource deployments influence firm-level performance. Strategic Management Journal, 26, 489–496. CrossRef
Lev, B., Petrovits, C., & Radhakrishnan, S. (2010). Is doing good good for you? How corporate charitable contributions enhance revenue growth. Strategic Management Journal, 31(2), 182–200.
Lys, T., Naughton, J., & Wang, C. (2015). Signaling through corporate accountability accounting. Journal of Accounting and Economics, 60, 56–72. CrossRef
Masulis, R., & Reza, S. W. (2015). Agency problems of corporate philanthropy. Review of Financial Studies, 28(2), 592–636. CrossRef
McWilliams, A., & Siegel, D. (2000). Corporate social responsibility and financial performance: correlation or misspecification? Strategic Management Journal, 21(5), 603–609. CrossRef
Miller, M., & Rock, K. (1985). Dividend policy under asymmetric information. Journal of Finance, 40, 1031–1051. CrossRef
Navarro, P. (1988). Why do corporations give to charity? Journal of Business, 61, 66–75.
Orlitzky, M., & Benjamin, J. (2001). Corporate social performance and firm risk: A meta-analytic review. Business and Society, 40, 369–396. CrossRef
Pastor, L., & Stambaugh, R. (2003). Liquidity risk and expected stock returns. Journal of Political Economy, 111(3), 642–685. CrossRef
Peloza, J. (2006). Using corporate social responsibility as insurance for financial performance. California Management Review, 48(2), 52–72. CrossRef
Porter, M. E., & Kramer, M. R. (2002). The competitive advantage of corporate philanthropy. Harvard Business Review, 80, 5–16.
Ramchander, S., Schwebach, R., & Staking, K. (2012). The information relevance of corporate social responsibility: Evidence from DS400 index reconstitutions. Strategic Management Journal, 33(3), 303–314. CrossRef
Rosenbaum, P. R., & Rubin, D. B. (1983). The central role of the propensity score in observational studies for causal effects. Biometrika, 70, 41–55. CrossRef
Seifert, B., Morris, S. A., & Bartkus, B. R. (2003). Comparing big givers and small givers: Financial correlates of corporate philanthropy. Journal of Business Ethics, 45, 195–211. CrossRef
Servaes, H., & Tamayo, A. (2013). The Impact of corporate social responsibility on firm value: The role of customer awareness. Management Science, 59(5), 1045–1061. CrossRef
Shapira, R. (2012). Corporate philanthropy as signaling and co-optation. Fordham Law Review, 80, 1889–1939.
Shleifer, A., & Vishny, R. (1997). The limits to arbitrage. Journal of Finance, 52(1), 35–55. CrossRef
Stock, J. H., & Yogo, M. (2005). Testing for weak instruments in IV regression. In W. Donald, K. Andrews, & J. Stock (Eds.), Identification and inference for econometric models: A festschrift in honor of Thomas Rothenberg (pp. 80–108). Cambridge: Cambridge University Press. CrossRef
Su, W., Peng, M., Tan, W., & Cheung, Y. (2014). Signaling effect of corporate social responsibility in emerging economies. Journal of Business Ethics. doi: 10.1007/s10551-014-2404-4.
Thurow, L. (1974). Cash versus in-kind transfers. American Economic Review Papers and Proceedings, 64(2), 190–195.
Turban, D. B., & Greening, D. W. (1997). Corporate social performance and organizational attractiveness to prospective employees. Academy of Management Journal, 40(3), 658–672.
Udayasankar, K. (2008). Corporate social responsibility and firm size. Journal of Business Ethics, 83(2), 167–175. CrossRef
Waddock, A. W., & Graves, S. B. (1997). The corporate social performance-financial performance link. Strategic Management Journal, 18(4), 303–319. CrossRef
Wang, J., & Coffey, B. (1992). Board composition and corporate philanthropy. Journal of Business Ethics, 11(10), 771–778. CrossRef
Wang, H., & Qian, C. (2011). Corporate philanthropy and corporate financial performance: The roles of stakeholder response and political access. Academy of Management Journal, 54(6), 1159–1181. CrossRef
Wilson, J., & Musick, M. (1997). Who cares? Toward an integrated theory of volunteer work. American Sociological Review, 62, 694–713. CrossRef
- Is there Informational Value in Corporate Giving?
- Springer Netherlands
Neuer Inhalt/© Stellmach, Neuer Inhalt/© Maturus, Pluta Logo/© Pluta