IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v50y2022ics1544612322004640.html
   My bibliography  Save this article

ESG performance and CSR awards: Does consistency matter?

Author

Listed:
  • Uyar, Ali
  • Kuzey, Cemil
  • Karaman, Abdullah S.

Abstract

In this study, drawing on social reputation theory, we focus on the non-financial benefit (social reputation) of ESG engagement via CSR awarding and consider ESG inconsistency. The country-industry-year fixed-effects logistic regression analysis was executed based on the data including 45,395 observations between 2012 and 2019. We find that social reputation via CSR awarding requires a full ESG commitment in environmental, social, and governance pillars. However, governance pillar is less relevant for social reputation than the environmental and social pillars. Besides, ESG inconsistency over time and across ESG dimensions harms social reputation as it negatively moderates ESG performance and CSR awarding.

Suggested Citation

  • Uyar, Ali & Kuzey, Cemil & Karaman, Abdullah S., 2022. "ESG performance and CSR awards: Does consistency matter?," Finance Research Letters, Elsevier, vol. 50(C).
    • Handle: RePEc:eee:finlet:v:50:y:2022:i:c:s1544612322004640
    DOI: 10.1016/j.frl.2022.103276
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612322004640
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2022.103276?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, December.
    2. Amal Aouadi & Sylvain Marsat, 2018. "Do ESG Controversies Matter for Firm Value? Evidence from International Data," Post-Print halshs-02007374, HAL.
    3. Laura Schons & Maria Steinmeier, 2016. "Walk the Talk? How Symbolic and Substantive CSR Actions Affect Firm Performance Depending on Stakeholder Proximity," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 23(6), pages 358-372, November.
    4. Shih-wei Wu & Fengyi Lin & Chia-ming Wu, 2014. "Corporate Social Responsibility and Cost of Capital: An Empirical Study of the Taiwan Stock Market," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 50(S1), pages 107-120.
    5. Amal Aouadi & Sylvain Marsat, 2018. "Do ESG Controversies Matter for Firm Value? Evidence from International Data," Journal of Business Ethics, Springer, vol. 151(4), pages 1027-1047, September.
    6. Rjiba, Hatem & Jahmane, Abderrahman & Abid, Ilyes, 2020. "Corporate social responsibility and firm value: Guiding through economic policy uncertainty," Finance Research Letters, Elsevier, vol. 35(C).
    7. Vincenzo Verardi & Catherine Dehon, 2010. "Multivariate outlier detection in Stata," Stata Journal, StataCorp LP, vol. 10(2), pages 259-266, June.
    8. Kuzey, Cemil & Fritz, Morgane M.C. & Uyar, Ali & Karaman, Abdullah S., 2022. "Board gender diversity, CSR strategy, and eco-friendly initiatives in the transportation and logistics sector," International Journal of Production Economics, Elsevier, vol. 247(C).
    9. Cai, Xiangshang & Gao, Ning & Garrett, Ian & Xu, Yan, 2020. "Are CEOs judged on their companies' social reputation?," Journal of Corporate Finance, Elsevier, vol. 64(C).
    10. Abdirahman Anas & Hafiz Majdi Abdul Rashid & Hairul Azlan Annuar, 2015. "The effect of award on CSR disclosures in annual reports of Malaysian PLCs," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 11(4), pages 831-852, October.
    11. La Rosa, Fabio & Liberatore, Giovanni & Mazzi, Francesco & Terzani, Simone, 2018. "The impact of corporate social performance on the cost of debt and access to debt financing for listed European non-financial firms," European Management Journal, Elsevier, vol. 36(4), pages 519-529.
    12. Shih-wei Wu & Fengyi Lin & Chia-ming Wu, 2014. "Corporate Social Responsibility and Cost of Capital: An Empirical Study of the Taiwan Stock Market," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 50(1S), pages 107-120, January.
    13. Busaya Virakul & Kalayanee Koonmee & Gary N. McLean, 2009. "CSR activities in award‐winning Thai companies," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 5(2), pages 178-199, June.
    14. Peter Tashman & Valentina Marano & Tatiana Kostova, 2019. "Walking the walk or talking the talk? Corporate social responsibility decoupling in emerging market multinationals," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(2), pages 153-171, March.
    15. Rouine, Ibtissem & Ammari, Aymen & Bruna, Maria Giuseppina, 2022. "Nonlinear impacts of CSR performance on firm risk: New evidence using a panel smooth threshold regression," Finance Research Letters, Elsevier, vol. 47(PB).
    16. Claudia Arena & Ronald Liong & Petros Vourvachis, 2018. "Carrot or stick: CSR disclosures by Southeast Asian companies," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 9(4), pages 422-454, July.
    17. Ben Hmiden, Oussama & Rjiba, Hatem & Saadi, Samir, 2022. "Competition through environmental CSR engagement and cost of equity capital," Finance Research Letters, Elsevier, vol. 47(PB).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sun, Weizheng & Chen, Shuning & Jiao, Yuqing & Feng, Xu, 2024. "How does ESG constrain corporate earnings management? Evidence from China," Finance Research Letters, Elsevier, vol. 61(C).
    2. de la Fuente, Gabriel & Velasco, Pilar, 2024. "Pretending to be sustainable: Is ESG disparity a symptom?," Journal of Contemporary Accounting and Economics, Elsevier, vol. 20(2).
    3. Yang, Zhonghai & Song, Pingting & Xu, Meng & Li, Yingmei, 2024. "Environmental, social and governance performance and equity mispricing: Does embedded information mediation matter?," Finance Research Letters, Elsevier, vol. 67(PB).
    4. Uyar, Ali & Wasiuzzaman, Shaista & Kuzey, Cemil & Karaman, Abdullah S., 2024. "Dividend payout and corporate transparency: Do CSR governance mechanisms matter?," Research in International Business and Finance, Elsevier, vol. 71(C).
    5. Zhang, Jitao & Yang, Yongliang, 2023. "Can environmental disclosure improve price efficiency? The perspective of price delay," Finance Research Letters, Elsevier, vol. 52(C).
    6. Xue, Qinyuan & Jin, Yifei & Zhang, Cheng, 2024. "ESG rating results and corporate total factor productivity," International Review of Financial Analysis, Elsevier, vol. 95(PA).
    7. Abdullah S. Karaman & Nejla Ould Daoud Ellili & Ali Uyar, 2024. "Do sustainable supply chain practices mitigate carbon emissions? The role of supplier environmental, social and governance training," Business Strategy and the Environment, Wiley Blackwell, vol. 33(8), pages 8126-8148, December.
    8. Marcia Sierdovski & Luiz Alberto Pilatti & Priscila Rubbo & Claudia Tania Picinin, 2024. "Incredible Work Environments in Brazil: What the 2020 Award- Winners can Teach us," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 19(4), pages 2015-2033, August.
    9. Ali Uyar & Habiba Al‐Shaer & Cemil Kuzey & Abdullah S. Karaman, 2024. "Do foreign directors reinforce better waste management? The moderating role of eco‐innovation," Business Strategy and the Environment, Wiley Blackwell, vol. 33(3), pages 2040-2065, March.
    10. Cheng, Zhonghua & Su, Yang, 2024. "ESG and Chinese corporate OFDI," Research in International Business and Finance, Elsevier, vol. 72(PA).
    11. Sahar E-Vahdati & Wan Nordin Wan-Hussin & Mohd Shazwan Mohd Ariffin, 2023. "The Value Relevance of ESG Practices in Japan and Malaysia: Moderating Roles of CSR Award, and Former CEO as a Board Chair," Sustainability, MDPI, vol. 15(3), pages 1-17, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Uyar, Ali & Lodh, Suman & Nandy, Monomita & Kuzey, Cemil & Karaman, Abdullah S., 2023. "Tradeoff between corporate investment and CSR: The moderating effect of financial slack, workforce slack, and board gender diversity," International Review of Financial Analysis, Elsevier, vol. 87(C).
    2. Ali Uyar & Simone Pizzi & Fabio Caputo & Cemil Kuzey & Abdullah S. Karaman, 2022. "Do shareholders reward or punish risky firms due to CSR reporting and assurance?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(5), pages 1596-1620, July.
    3. Uyar, Ali & Wasiuzzaman, Shaista & Kuzey, Cemil & Karaman, Abdullah S., 2024. "Dividend payout and corporate transparency: Do CSR governance mechanisms matter?," Research in International Business and Finance, Elsevier, vol. 71(C).
    4. Ali Uyar & Habiba Al‐Shaer & Cemil Kuzey & Abdullah S. Karaman, 2024. "Do foreign directors reinforce better waste management? The moderating role of eco‐innovation," Business Strategy and the Environment, Wiley Blackwell, vol. 33(3), pages 2040-2065, March.
    5. Al-Shaer, Habiba & Uyar, Ali & Kuzey, Cemil & Karaman, Abdullah S., 2023. "Do shareholders punish or reward excessive CSR engagement? Moderating effect of cash flow and firm growth," International Review of Financial Analysis, Elsevier, vol. 88(C).
    6. Nadine Gatzert & Philipp Reichel, 2022. "Awareness of climate risks and opportunities: empirical evidence on determinants and value from the U.S. and European insurance industry," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 47(1), pages 5-26, January.
    7. Garanina, Tatiana & Kim, Oksana, 2023. "The relationship between CSR disclosure and accounting conservatism: The role of state ownership," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 50(C).
    8. Cemil Kuzey & Habiba Al-Shaer & Ali Uyar & Abdullah S. Karaman, 2024. "Do board monitoring and audit committee quality help risky firms reduce CSR controversies?," Review of Quantitative Finance and Accounting, Springer, vol. 63(3), pages 1007-1045, October.
    9. Krivogorsky, Victoria & Mintchik, Natalia & Alon, Anna, 2023. "Accounting research in former Soviet bloc countries: Past trends and current and future developments," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 50(C).
    10. Habiba Al‐Shaer & Cemil Kuzey & Ali Uyar & Abdullah S. Karaman, 2024. "Corporate strategy, board composition, and firm value," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 29(3), pages 3177-3202, July.
    11. Meftah Gerged, Ali & Kuzey, Cemil & Uyar, Ali & Karaman, Abdullah S., 2023. "Does investment stimulate or inhibit CSR transparency? The moderating role of CSR committee, board monitoring and CEO duality," Journal of Business Research, Elsevier, vol. 159(C).
    12. Sonia Boukattaya & Zyed Achour & Zeineb Hlioui, 2021. "Corporate Social Responsibility and Corporate Financial Performance: An Empirical Literature Review," Post-Print hal-03472433, HAL.
    13. Charl de Villiers & Jing Jia & Zhongtian Li, 2022. "Corporate social responsibility: A review of empirical research using Thomson Reuters Asset4 data," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(4), pages 4523-4568, December.
    14. Uyar, Ali & Gerged, Ali Meftah & Kuzey, Cemil & Karaman, Abdullah S., 2024. "Corporate innovation capacity, national innovation setting, and renewable energy use," Technological Forecasting and Social Change, Elsevier, vol. 205(C).
    15. Gregory Jackson & Julia Bartosch & Emma Avetisyan & Daniel Kinderman & Jette Steen Knudsen, 2020. "Mandatory Non-financial Disclosure and Its Influence on CSR: An International Comparison," Journal of Business Ethics, Springer, vol. 162(2), pages 323-342, March.
    16. Ali Uyar & Ali Meftah Gerged & Cemil Kuzey & Abdullah S. Karaman, 2024. "Renewable energy use, slack financial resources, and board attributes: Does energy efficiency policy matter?," Business Strategy and the Environment, Wiley Blackwell, vol. 33(5), pages 4935-4957, July.
    17. Ali Uyar & Cemil Kuzey & Merve Kilic & Abdullah S. Karaman, 2021. "Board structure, financial performance, corporate social responsibility performance, CSR committee, and CEO duality: Disentangling the connection in healthcare," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(6), pages 1730-1748, November.
    18. Muneer Shaik & Mohd Ziaur Rehman, 2023. "The Dynamic Volatility Connectedness of Major Environmental, Social, and Governance (ESG) Stock Indices: Evidence Based on DCC-GARCH Model," Asia-Pacific Financial Markets, Springer;Japanese Association of Financial Economics and Engineering, vol. 30(1), pages 231-246, March.
    19. Wong, Jin Boon & Zhang, Qin, 2022. "Stock market reactions to adverse ESG disclosure via media channels," The British Accounting Review, Elsevier, vol. 54(1).
    20. Denny IRAWAN & OKIMOTO Tatsuyoshi, 2021. "How Do ESG Performance and Awareness Affect Firm Value and Corporate Overinvestment?," Discussion papers 21033, Research Institute of Economy, Trade and Industry (RIETI).

    More about this item

    Keywords

    CSR; ESG; ESG consistency; CSR award; Social reputation theory;
    All these keywords.

    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:50:y:2022:i:c:s1544612322004640. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.