Corporate Social Responsibility and Economic Stability: International Evidence

SYNOPSIS This study examines the association between the aggregate corporate social responsibility (CSR) investments of publicly listed firms domiciled in a country and the country’s economic stability. Using data from 40 countries from 2002 to 2017, we find that the aggregate CSR investments in a country positively affect its overall economic stability. We also find that a relatively high level of aggregate CSR investments can lead to a more stable supply of external capital and persistent investment decisions. Further analyses show that these findings are more pronounced for countries with less developed capital markets, low levels of societal trust, and strong stakeholder orientations. Moreover, we find that the implementation of mandatory CSR disclosure requirements weakens the positive effect of aggregate CSR investments on economic stability. These results collectively suggest that aggregate CSR investments in a country substantially foster that country’s overall economic development, contingent on its institutional context. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: M14; E32; M41.

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Publication Details

Journal
Accounting Horizons
Published
2024-08-29
DOI
https://doi.org/10.2308/horizons-2022-196
Citations
4
Primary Topic
Business and Economic Development
Type
article
Field-Weighted Citation Impact
2.84
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article

Corporate Social Responsibility and Economic Stability: International Evidence

Xiangting Kong, Huijuan Cao, Albert Tsang
4 citations
Accounting Horizons
Business and Economic Development
2.84
article

Corporate Social Responsibility and Economic Stability: International Evidence

Xiangting Kong, Huijuan Cao, Albert Tsang
article en
4 citations

Abstract

SYNOPSIS This study examines the association between the aggregate corporate social responsibility (CSR) investments of publicly listed firms domiciled in a country and the country’s economic stability. Using data from 40 countries from 2002 to 2017, we find that the aggregate CSR investments in a country positively affect its overall economic stability. We also find that a relatively high level of aggregate CSR investments can lead to a more stable supply of external capital and persistent investment decisions. Further analyses show that these findings are more pronounced for countries with less developed capital markets, low levels of societal trust, and strong stakeholder orientations. Moreover, we find that the implementation of mandatory CSR disclosure requirements weakens the positive effect of aggregate CSR investments on economic stability. These results collectively suggest that aggregate CSR investments in a country substantially foster that country’s overall economic development, contingent on its institutional context. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: M14; E32; M41.

Accounting HorizonsVol. 39(2)
Beijing Institute of Technology (CN), Sun Yat-sen University (CN), Southern University of Science and Technology (CN)
Openalex Percentile: Top 9%
Business and Economic Development
2.84
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