8th annual doctoral student conference
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8th annual doctoral student conference. Does Corporate Social Responsibility (CSR) Affect Firm Risk? . Presented by: Mohammed Benlemlih Supervisor : Pr . Isabelle Girerd -Potin. 8 th Annual Doctoral Student Conference . Presentation Overview. Definition & context. - PowerPoint PPT PresentationTRANSCRIPT
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Presented by: Mohammed Benlemlih
Supervisor: Pr. Isabelle Girerd-Potin
Does Corporate Social Responsibility (CSR) Affect Firm Risk?
8th Annual Doctoral Student Conference
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Presentation OverviewDefinition & context
HypothesesPrevious literature
Research Question
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Data & Methodology
Study Contribution
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‘‘A socially responsible firm is one whose managerial staff balances a multiplicity of interests. Instead of striving only for larger profits for stockholders, a responsible entreprise also takes into account employees, suppliers, dealers, local communities, and the nation.’’
(Johnson, 1971)
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5(Booz & Company, 2009)8th annual doctoral student conference
RI : Responsible Investment AUM : Assets Under Management
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Previous literature on CSR focused on relationship between social performance and financial performance
What is the impact of CSR on firm performance?
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No consensus on this relationship
Positive Negative
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What will we do?
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A new research stream to study the relationship between CSR and financial risk
Does corporate social responsibility affect firm risk?
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Systematic & downside
risk
American market
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A negative and significant relationship between CSR and financial risk
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8th annual doctoral student conference
Stablestakeholder relations
Customer loyalty
Employee support
Low risk of lawsuits
Low risk of financial
penalities
H1: Social rating is negatively related to financial risk
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Corporate governance
H2: Impact of CSR on risk is better captured when using individual
measures for CSR
Dimensions of CSR are those of Vigeo Rating
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H3:The negative relationship between corporate social responsibility and financial risk is stronger during times of crisis
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And how ?!
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Portfolio approach: Create responsible and
non-responsible portfolios. Compare risk level in each portfolio.
Regression approach: Estimate a model.
Try to explain firm financial risk by CSR ratings and other variables.
Two different approaches:
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Sample period: 01/12/1999 to 01/01/2012
European countries
CSR measures: Vigeo ratings
Risk measures: Systematic & idiosyncratic risk Downside risk
Data
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Uncover new pieces of the CSP-FP puzzle
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Any questions?
Thank you for your attention!
8th annual doctoral student conference