Is Institutional Ownership Related to Corporate Social Responsibility? The Nonlinear Relation and Its Implication for Stock Return Volatility
This study examines the relation between corporate social responsibility (CSR) and institutional investor ownership, and the impact of this relation on stock return volatility. We find that institutional ownership does not strictly increase or decrease in CSR; rather, institutional ownership is a co...
| Published in: | Journal of business ethics |
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| Authors: | ; ; |
| Format: | Electronic Article |
| Language: | English |
| Check availability: | HBZ Gateway |
| Journals Online & Print: | Drawer...
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| Fernleihe: | Fernleihe für die Fachinformationsdienste |
| Published: |
Springer Science + Business Media B. V
2017
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| In: |
Journal of business ethics
Year: 2017, Volume: 146, Issue: 1, Pages: 77-109 |
| Further subjects: | B
Socially Responsible Investing
B Corporate social responsibility B Institutional ownership B Stock return volatility |
| Online Access: |
Presumably Free Access Volltext (JSTOR) Volltext (lizenzpflichtig) |
| Summary: | This study examines the relation between corporate social responsibility (CSR) and institutional investor ownership, and the impact of this relation on stock return volatility. We find that institutional ownership does not strictly increase or decrease in CSR; rather, institutional ownership is a concave function of CSR. This evidence suggests that institutional investors do not see CSR as strictly value-enhancing activities. Institutional investors adjust their percentage of ownership when CSR activities go beyond the perceived optimal level. Employing the path analysis, we also examine the mediating effect of institutional ownership on the relation between CSR and stock return volatility. We find that CSR decreases stock return volatility at a decreasing rate through its effect on institutional ownership. Our results remain robust under several different CSR measures and estimation methods. |
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| ISSN: | 1573-0697 |
| Contains: | Enthalten in: Journal of business ethics
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| Persistent identifiers: | DOI: 10.1007/s10551-015-2883-y |