Corporate social responsibility intensity: Shareholders’ value adding or destroying?

This paper examines whether an intensification of corporate social responsibility activities adds or destroys firms’ value in Nigeria. Fixed effect regression analytic tool was used to analyze the data from a sample of 56 listed firms on Nigerian Stock Exchange (NSE) between 2009 and 2018. We follow...

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Autores principales:	Cosmas Ikechukwu Asogwa, Osmund Chinweoda Ugwu, Godwin Keres Okoro Okereke, Adedoyin Samuel, Airenvbahihe Igbinedion, Anthonia Uju Uzuagu, Samson Ige Abolarinwa
Formato:	article
Lenguaje:	EN
Publicado:	Taylor & Francis Group 2020
Materias:	corporate environmental corporate social corporate economic value adding value destroying csr intensive responsibility financial performance Business HF5001-6182 Management. Industrial management HD28-70
Acceso en línea:	https://doaj.org/article/3c2c1c97b48248ff88e729dda6dc39ed
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spelling	oai:doaj.org-article:3c2c1c97b48248ff88e729dda6dc39ed2021-12-02T15:59:51ZCorporate social responsibility intensity: Shareholders’ value adding or destroying?2331-197510.1080/23311975.2020.1826089https://doaj.org/article/3c2c1c97b48248ff88e729dda6dc39ed2020-01-01T00:00:00Zhttp://dx.doi.org/10.1080/23311975.2020.1826089https://doaj.org/toc/2331-1975This paper examines whether an intensification of corporate social responsibility activities adds or destroys firms’ value in Nigeria. Fixed effect regression analytic tool was used to analyze the data from a sample of 56 listed firms on Nigerian Stock Exchange (NSE) between 2009 and 2018. We followed environmental, social and economic responsibility activities rating based on Global Reporting Initiative (GRI) disclosure guidelines and Korean Economic Justice Institutes (KEJI) social responsibility efficient interpolation rating formula in the measure of firms’ social responsibility. The study found that firms that engage in intensive social responsibility yielded positive and insignificant effect on firms’ stock value. This implied that an aggressive social responsibility is not the best approach as it possesses the potential to destroy shareholders’ value. On the other hand, we found evidence that medium social responsibility model significantly affected firms’ financial performance (coefficient = 0.165; p-value >0.05), which suggests that the best social responsibility strategy that significantly increases shareholders’ value is the middle course model. A further test showed that generally environmental, social and economic responsibility activities of firms significantly add to firms’ market value (Coefficients = 0.028; 0.216; 0.037; p-values<0.05). However, the degree of the effect is contingent on the intensity of the activities and governance structures. Governance structure and board diversity explained firms’ efficient CSR strategy that promotes middle course strategies while CSR aggressiveness is explained by unitary model of board leadership. Thus, implementation within an industry average performance adds significantly to investors’ value provided that there is effective corporate governance structure.Cosmas Ikechukwu AsogwaOsmund Chinweoda UgwuGodwin Keres Okoro OkerekeAdedoyin SamuelAirenvbahihe IgbinedionAnthonia Uju UzuaguSamson Ige AbolarinwaTaylor & Francis Grouparticlecorporate environmentalcorporate socialcorporate economicvalue addingvalue destroyingcsrintensiveresponsibilityfinancial performanceBusinessHF5001-6182Management. Industrial managementHD28-70ENCogent Business & Management, Vol 7, Iss 1 (2020)
institution	DOAJ
collection	DOAJ
language	EN
topic	corporate environmental corporate social corporate economic value adding value destroying csr intensive responsibility financial performance Business HF5001-6182 Management. Industrial management HD28-70
spellingShingle	corporate environmental corporate social corporate economic value adding value destroying csr intensive responsibility financial performance Business HF5001-6182 Management. Industrial management HD28-70 Cosmas Ikechukwu Asogwa Osmund Chinweoda Ugwu Godwin Keres Okoro Okereke Adedoyin Samuel Airenvbahihe Igbinedion Anthonia Uju Uzuagu Samson Ige Abolarinwa Corporate social responsibility intensity: Shareholders’ value adding or destroying?
description	This paper examines whether an intensification of corporate social responsibility activities adds or destroys firms’ value in Nigeria. Fixed effect regression analytic tool was used to analyze the data from a sample of 56 listed firms on Nigerian Stock Exchange (NSE) between 2009 and 2018. We followed environmental, social and economic responsibility activities rating based on Global Reporting Initiative (GRI) disclosure guidelines and Korean Economic Justice Institutes (KEJI) social responsibility efficient interpolation rating formula in the measure of firms’ social responsibility. The study found that firms that engage in intensive social responsibility yielded positive and insignificant effect on firms’ stock value. This implied that an aggressive social responsibility is not the best approach as it possesses the potential to destroy shareholders’ value. On the other hand, we found evidence that medium social responsibility model significantly affected firms’ financial performance (coefficient = 0.165; p-value >0.05), which suggests that the best social responsibility strategy that significantly increases shareholders’ value is the middle course model. A further test showed that generally environmental, social and economic responsibility activities of firms significantly add to firms’ market value (Coefficients = 0.028; 0.216; 0.037; p-values<0.05). However, the degree of the effect is contingent on the intensity of the activities and governance structures. Governance structure and board diversity explained firms’ efficient CSR strategy that promotes middle course strategies while CSR aggressiveness is explained by unitary model of board leadership. Thus, implementation within an industry average performance adds significantly to investors’ value provided that there is effective corporate governance structure.
format	article
author	Cosmas Ikechukwu Asogwa Osmund Chinweoda Ugwu Godwin Keres Okoro Okereke Adedoyin Samuel Airenvbahihe Igbinedion Anthonia Uju Uzuagu Samson Ige Abolarinwa
author_facet	Cosmas Ikechukwu Asogwa Osmund Chinweoda Ugwu Godwin Keres Okoro Okereke Adedoyin Samuel Airenvbahihe Igbinedion Anthonia Uju Uzuagu Samson Ige Abolarinwa
author_sort	Cosmas Ikechukwu Asogwa
title	Corporate social responsibility intensity: Shareholders’ value adding or destroying?
title_short	Corporate social responsibility intensity: Shareholders’ value adding or destroying?
title_full	Corporate social responsibility intensity: Shareholders’ value adding or destroying?
title_fullStr	Corporate social responsibility intensity: Shareholders’ value adding or destroying?
title_full_unstemmed	Corporate social responsibility intensity: Shareholders’ value adding or destroying?
title_sort	corporate social responsibility intensity: shareholders’ value adding or destroying?
publisher	Taylor & Francis Group
publishDate	2020
url	https://doaj.org/article/3c2c1c97b48248ff88e729dda6dc39ed
work_keys_str_mv	AT cosmasikechukwuasogwa corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying AT osmundchinweodaugwu corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying AT godwinkeresokorookereke corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying AT adedoyinsamuel corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying AT airenvbahiheigbinedion corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying AT anthoniaujuuzuagu corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying AT samsonigeabolarinwa corporatesocialresponsibilityintensityshareholdersvalueaddingordestroying
_version_	1718385323129438208

Corporate social responsibility intensity: Shareholders’ value adding or destroying?

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