The Impact of Corporate Social Responsibility on Firm Value: The Role of Customer Awareness

The Impact of Corporate Social Responsibility on Firm Value: The Role of Customer Awareness

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Article ID: iaor20132431
Volume: 59
Issue: 5
Start Page Number: 1045
End Page Number: 1061
Publication Date: May 2013
Journal: Management Science
Authors: ,
Keywords: social capital
Abstract:

This paper shows that corporate social responsibility (CSR) and firm value are positively related for firms with high customer awareness, as proxied by advertising expenditures. For firms with low customer awareness, the relation is either negative or insignificant. In addition, we find that the effect of awareness on the CSR–value relation is reversed for firms with a poor prior reputation as corporate citizens. This evidence is consistent with the view that CSR activities can add value to the firm but only under certain conditions.

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