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What Drives Investor Response to CSR Performance Reports?

Author

Listed:
  • Andres Guiral
  • Doocheol Moon
  • Hun‐Tong Tan
  • Yao Yu

Abstract

Recent research finds that investors' assessments of a stock's fundamental value are influenced by corporate social responsibility (CSR) performance through the affect‐as‐information heuristic. We extend prior research by examining two boundary conditions for the use of this heuristic: (i) whether the CSR performance relates to activities that are integrated in a firm's core business practices (material CSR issues) or not (immaterial CSR issues), and (ii) whether the CSR performance is positive or negative. Employing an experimental method, we find that the affect‐as‐information heuristic applies only to immaterial CSR issues but not to material CSR issues, and only to positive but not negative CSR performance. Our findings suggest that investors likely use a heuristic approach to process immaterial and positive CSR issues, and a more deliberate and systematic approach to process material or negative CSR issues. Our study has both practical and theoretical implications. Qu'est‐ce qui oriente la réaction des investisseurs aux rapports de performance quant à la RSE? Les études récentes mènent à la conclusion que la détermination de la valeur fondamentale d'une action par les investisseurs est soumise à l'influence de la performance quant à la RSE (responsabilité sociale de l'entreprise) telle qu'elle est perçue selon une heuristique d'inférence arbitraire (affect‐as‐information heuristic) (Elliott et al., 2014). Les auteurs poussent plus loin les recherches précédentes en examinant deux conditions limites d'utilisation de cette heuristique : 1) l'existence d'un lien entre la performance quant à la RSE et les activités qui sont intégrées aux pratiques commerciales essentielles d'une entreprise (enjeux d'importance liés à la RSE) ou son inexistence (enjeux de peu d'importance liés à la RSE), et 2) l’évaluation positive ou négative de la performance quant à la RSE. Recourant à une méthode expérimentale, les auteurs constatent que cette heuristique s'applique uniquement aux enjeux de peu d'importance liés à la RSE et non aux enjeux d'importance, et uniquement à la performance positive quant à la RSE et non à la performance négative. Les observations des auteurs semblent indiquer que les investisseurs sont susceptibles de recourir à une méthode heuristique dans le traitement des enjeux de peu d'importance et positifs liés à la RSE, et une méthode plus réfléchie et systématique dans celui des enjeux d'importance ou négatifs liés à la RSE. Les retombées de l’étude sont à la fois pratiques et théoriques.

Suggested Citation

  • Andres Guiral & Doocheol Moon & Hun‐Tong Tan & Yao Yu, 2020. "What Drives Investor Response to CSR Performance Reports?," Contemporary Accounting Research, John Wiley & Sons, vol. 37(1), pages 101-130, March.
  • Handle: RePEc:wly:coacre:v:37:y:2020:i:1:p:101-130
    DOI: 10.1111/1911-3846.12521
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    References listed on IDEAS

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