Firms with older assets have lower social responsibility ratings. After Operating controlling for assets earnings/assets, age and industry, Operating there is still weak Cochran earnings/sales, support for link and Wood excess market between CSR and (1984) Reputation index (R ) valuation financial performance. 39 firms (o) Positive relationship with ROA and total assets are found. Negative relation is found with operating income growth and all market based measures. The authors concluded Stock returns, that is may be more to ROA, sales consider financial Fortune magazine growth, asset performance as a McGuire rating: 'responsibility to growth, variable influencing et.al. community/environment' operating social responsibility (1988) (R ) income growth than reverse. (+) 98 firms (+) Accounting and McWilliams Kinder, Lydenberg, financial All relationships and Siegel Domini (KLD) measure measures of appear to be strongly (2000) (SA/P/O) profitability positively related. (+) Firms which have been perceived as having social Market return, responsibility criteria P/E ratio, have generally been market to book shown to have value, ROA, financial performance Pava and Dichotomization based ROE, EPS, at least on a par, if not Krausz on CEP rakings dividend payout better, than other 106 (1995) (SA/P/O) ratio firms. firms (+) Rockness Higher ROE resulted et.al. Amount of waste/ Accounting in smaller amounts of (1986) disposal reported based returns pollution. (+) A negative relationship between the social responsibilty index and the Reputational indexes of profitability is found for Vance corporate social Changes in 13 of the 14 (1975) involvement (R ) stock prices investigated firms. (-)
Cochran and Wood (1984) Reputation index (R ) Operating earnings/assets, Operating earnings/sales, excess market valuation Firms with older assets have lower social responsibility ratings. After controlling for assets age and industry, there is still weak support for link between CSR and financial performance. 39 firms (o) McGuire et.al. (1988) Fortune magazine rating: 'responsibility to community/environment' (R ) Stock returns, ROA, sales growth, asset growth, operating income growth Positive relationship with ROA and total assets are found. Negative relation is found with operating income growth and all market based measures. The authors concluded that is may be more to consider financial performance as a variable influencing social responsibility than reverse. (+) 98 firms (+) McWilliams and Siegel (2000) Kinder, Lydenberg, Domini (KLD) measure (SA/P/O) Accounting and financial measures of profitability All relationships appear to be strongly positively related. (+) Pava and Krausz (1995) Dichotomization based on CEP rakings (SA/P/O) Market return, P/E ratio, market to book value, ROA, ROE, EPS, dividend payout ratio Firms which have been perceived as having social responsibility criteria have generally been shown to have financial performance at least on a par, if not better, than other firms. 106 firms (+) Rockness et.al. (1986) Amount of waste/ disposal reported Accounting based returns Higher ROE resulted in smaller amounts of pollution. (+) Vance (1975) Reputational indexes of corporate social involvement (R ) Changes in stock prices A negative relationship between the social responsibilty index and the profitability is found for 13 of the 14 investigated firms. (-)