Various Classifiers to Investigate the Relationship Between CSR Activities and Corporate Value

The relationship between corporate social responsibility (CSR) and financial performance is complex and nuanced. Many studies have reported positive, negative, and neutral impacts of CSR on financial performance. This inconsistency is due to differences in methodologies, approaches, and selection of variables. Rather than focusing on specific variables, the present study aims to classify as many variables as possible in CSR if they contribute to shaping corporate value. In this study, we calculate corporate value using the Ohlson model based on income, since many previous studies focus on only a market-based approach. We chose some common classifiers that were appropriate for the nature of our data. After evaluating the performance of each classifier, we found that the Decision Tree is the best classifier to analyze the relationship between CSR activities and corporate value. Based on the tree, companies with high or medium corporate values seek to enhance their CSR activities or to empower secondary stakeholders (e.g., communities, societies), as indicated by cooperation with NPO/NGO. In contrast, companies with low corporate values still focus their CSR activities on primary stakeholders (e.g., customers, employees).