Corporate Social Responsibility as a managerial learning process
The purpose of this paper is twofold. 1) We propose for the first time in the literature a theory (managerial learning hypothesis) that may explain why managers engage in corporate social responsibility (CSR). 2) We use an intuitive empirical methodology (Edmans et al. 2017) to test the relevance/ir...
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doaj-4b423cf58baa4b60889ce9f1c1da77ce2021-05-18T10:58:29ZengACRN PublishingACRN Journal of Finance and Risk Perspectives2305-73942021-05-01101779410.35944/jofrp.2021.10.1.005Corporate Social Responsibility as a managerial learning processAhmed Marhfor0Kais Bouslah1Bouchra M'Zali2Université du Québec en Abitibi-TémiscamingueUniversity of St. Andrewsniversité du Québec à MontréalThe purpose of this paper is twofold. 1) We propose for the first time in the literature a theory (managerial learning hypothesis) that may explain why managers engage in corporate social responsibility (CSR). 2) We use an intuitive empirical methodology (Edmans et al. 2017) to test the relevance/irrelevance of our new theory. The idea behind our main contribution is that managers engage in CSR to learn new relevant information from other informed stakeholders. In return, managers will use both the new information and other information they already have to choose the optimal level of firm’s investment (Jayaraman and Wu, 2019). Therefore, we propose to examine whether a strong CSR engagement improves revelatory efficiency (Edmans et al. 2012, 2017). The latter accounts for the extent to which stock prices reveal new information to managers that will help them make value-maximizing choices. Our findings suggest that CSR activities do not allow firm’s managers to extract new information from their stock prices and ultimately improve the efficiency of their investment choices.https://www.acrn-journals.eu/resources/jofrp10e.pdfcorporate social responsibilitymanagerial learning theoryrevelatory efficiencyinvestment-price sensitivity |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Ahmed Marhfor Kais Bouslah Bouchra M'Zali |
spellingShingle |
Ahmed Marhfor Kais Bouslah Bouchra M'Zali Corporate Social Responsibility as a managerial learning process ACRN Journal of Finance and Risk Perspectives corporate social responsibility managerial learning theory revelatory efficiency investment-price sensitivity |
author_facet |
Ahmed Marhfor Kais Bouslah Bouchra M'Zali |
author_sort |
Ahmed Marhfor |
title |
Corporate Social Responsibility as a managerial learning process |
title_short |
Corporate Social Responsibility as a managerial learning process |
title_full |
Corporate Social Responsibility as a managerial learning process |
title_fullStr |
Corporate Social Responsibility as a managerial learning process |
title_full_unstemmed |
Corporate Social Responsibility as a managerial learning process |
title_sort |
corporate social responsibility as a managerial learning process |
publisher |
ACRN Publishing |
series |
ACRN Journal of Finance and Risk Perspectives |
issn |
2305-7394 |
publishDate |
2021-05-01 |
description |
The purpose of this paper is twofold. 1) We propose for the first time in the literature a theory (managerial learning hypothesis) that may explain why managers engage in corporate social responsibility (CSR). 2) We use an intuitive empirical methodology (Edmans et al. 2017) to test the relevance/irrelevance of our new theory. The idea behind our main contribution is that managers engage in CSR to learn new relevant information from other informed stakeholders. In return, managers will use both the new information and other information they already have to choose the optimal level of firm’s investment (Jayaraman and Wu, 2019). Therefore, we propose to examine whether a strong CSR engagement improves revelatory efficiency (Edmans et al. 2012, 2017). The latter accounts for the extent to which stock prices reveal new information to managers that will help them make value-maximizing choices. Our findings suggest that CSR activities do not allow firm’s managers to extract new information from their stock prices and ultimately improve the efficiency of their investment choices. |
topic |
corporate social responsibility managerial learning theory revelatory efficiency investment-price sensitivity |
url |
https://www.acrn-journals.eu/resources/jofrp10e.pdf |
work_keys_str_mv |
AT ahmedmarhfor corporatesocialresponsibilityasamanageriallearningprocess AT kaisbouslah corporatesocialresponsibilityasamanageriallearningprocess AT bouchramzali corporatesocialresponsibilityasamanageriallearningprocess |
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