Brammer, Stephen and Millington, Andrew. (2008) Does it pay to be different? An analysis of the relationship between corporate social and financial performance. Strategic Management Journal, Vol.29 (No.12). 1325 - 1343. ISSN 0143-2095

PDF (Version received does not comply with publishers policy) Brammer_&_Millington_(2008)_SMJ.pdf - Published Version Restricted to Repository staff only - Requires a PDF viewer such as GSview, Xpdf or Adobe Acrobat Reader Download (176Kb)

Abstract

This study explores the relationship between corporate social performance (CSP) and corporate financial performance (CFP) within the context of a specific component of CSP: corporate charitable giving. A model of the determinants of the extent of corporate charitable giving is estimated and used as the basis of a classification that groups firms according to the difference between their actual and their predicted intensity of gift giving. The financial performance attributes of the classification are explored. We found that firms with both unusually high and low CSP have higher financial performance than other firms, with unusually poor social performers doing best in the short run and unusually good social performers doing best over longer time horizons. Copyright © 2008 John Wiley & Sons, Ltd. ABSTRACT FROM AUTHOR

[error in script] [error in script]

Item Type:	Journal Article
Subjects:	H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management H Social Sciences > HF Commerce H Social Sciences > HG Finance
Divisions:	Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH):	Social responsibility of business, Corporations -- Finance -- Management
Journal or Publication Title:	Strategic Management Journal
Publisher:	John Wiley & Sons Ltd.
ISSN:	0143-2095
Date:	December 2008
Volume:	Vol.29
Number:	No.12
Page Range:	1325 - 1343
Identification Number:	10.1002/smj.714
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access
References:	Adams M, Hardwick P. 1998. An analysis of corporate donations: United Kingdom evidence. Journal of Management Studies 35(5): 641–654. Alexander GJ, Buchholz RA. 1978. Corporate social responsibility and stock market performance. Academy of Management Journal 21(3): 479–486. Atkinson L, Galaskiewicz J. 1988. Stock ownership and company contributions to charity. Administrative Sciences Quarterly 33: 82–100. Aupperle KE, Carroll AB, Hatfield JD. 1985. An empirical examination of the relationship between corporate social responsibility and profitability. Academy of Management Journal 28(2): 446–463. Barnett ML, Salomon RM. 2002. Unpacking social responsibility: the curvilinear relationship between social and financial performance. Academy of Management Proceedings: SIM; B1–B6. Bartkus BR, Morris SA, Seifert B. 2001. Stronger governance mechanisms: do they influence corporate philanthropy. Paper presented at the annual meeting of the Academy of Management, Washington, D.C. Benston GJ. 1982. Accounting numbers and economic values. Antitrust Bulletin 27: 161–215. Berman SL, Wicks AC, Kotha S, Jones TM. 1999. Does stakeholder orientation matter? The relationship between stakeholder management models and firm financial performance. Academy of Management Journal 42(5): 488–506. Bhattacharya CB, Sen S. 2004. Doing better at doing good: when, why and how consumers respond to corporate social initiatives. California Management Review 47(1): 9–24. Brammer S, Millington A. 2004. Stakeholder pressure, organizational size, and the allocation of departmental responsibility for the management of corporate charitable giving. Business & Society 43(3): 268–295. Carhart M. 1997. On persistence in mutual fund performance. Journal of Finance 52: 57–82. Carroll AB. 1979. A three-dimensional model of corporate performance. Academy of Management Review 44: 497–505. Donaldson T, Preston LE. 1995. The stakeholder theory of the corporation: concepts, evidence and implications. Academy of Management Review 20: 65–91. Dorfman R, Steiner PO. 1954. Optimal advertising and optimal quality. American Economic Review 44: 826–836. Fama EF. 1981. Stock returns, real activity, inflation, and money. The American Economic Review 71(4): 545–565. Freeman RE. 1984. StrategicManagement: A Stakeholder approach (Pitman Series in Business and Public Policy). Pitman: Boston, MA. Friedman M. 1970. The social responsibility of business is to increase its profits. New York Times Magazine, 13 September; 122–126. Godfrey PC. 2005. The relationship between corporate philanthropy and shareholder wealth: a risk management perspective. Academy of Management Review 30(4): 777–798. Greene WH. 1993. Econometric Analysis. Macmillan: New York. Greening DW, Turban DB. 2000. Corporate social performance as a competitive advantage in attracting a quality workforce. Business & Society 39(3): 254–280. Griffin JJ, Mahon JF. 1997. The corporate social performance and financial performance debate: twenty-five years of incomparable research. Business & Society 36(1): 5–31. Hamilton S, Jo H, Statman M. 1993. Doing Well While Doing Good? The Investment Performance of Socially Responsible Mutual Funds. Financial Analysts Journal 49(6): 62–66. Hart SL. 1995. A natural-resource-based view of the firm. Academy of Management Review 20(4): 986–1,014. Hillman AJ, Keim GD. 2001. Shareholder value, stakeholder management, and social issues: what’s the bottom line? Strategic Management Journal 22(2): 125–139. Jacobson LS, LaLonde RJ, Sullivan DG. 1993. Earnings losses of displaced workers. American Economic Review 83(4): 685–709. Jensen MC, Meckling WH. 1976. Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Accounting 3(4): 305–360. Johnson O. 1966. Corporate philanthropy: an analysis of corporate contributions. Journal of Business 39: 489–504. Jones TM. 1995. Instrumental stakeholder theory: a synthesis of ethics and economics. Academy of Management Review 20(2): 404–437. Kapstein EB. 2001. The corporate ethics crusade. Foreign Affairs 80(5): 105–119. Konar S, Cohen M. 2001. Does the market value environmental performance? Review of Economics and Statistics 83(2): 281–289. Maddala G. 1983. Limited Dependent and Qualitative Variables in Econometrics (Econometrics Society Monograph). Cambridge University Press: Cambridge, UK. Margolis JD, Walsh JP. 2003. Misery loves companies: rethinking social initiatives by business. Administrative Science Quarterly 48: 268–305. McElroy KM, Siegfried JJ. 1985. The effect of firms size on corporate philanthropy. Quarterly Review of Economics and Business 25(2): 18–26. McGuire JB, Sundgren A, Schneewiess T. 1988. Corporate social responsibility and firm financial performance. Academy of Management Review 31(4): 854–872. McWilliams A, Siegel D. 2000. Corporate social responsibility and financial performance: correlation or misspecification? Strategic Management Journal 21(5): 603–609. McWilliams A, Siegel D. 2001. Corporate social responsibility: a theory of the firm perspective. Academy of Management Review 26(1): 117–127. Meier KJ, O’Toole LJ Jr. 2002. Public management and organizational performance: the effect of managerial quality. Journal of Policy Analysis & Management 21(4): 629–643. Milgrom P, Roberts J. 1986. Price and advertising signals of product quality. Journal of Political Economy 94(4): 796–821. Moskowitz M. 1972. Choosing socially responsive stocks. Business and Society Review 10: 71–75. Navarro P. 1988. Why do corporations give to charity? Journal of Business 61: 65–93. Orlitzky M. 2001. Does firm size confound the relationship between corporate social performance and firm financial performance? Journal of Business Ethics 33(2): 167–180. Orlitzky M, Schmidt FL, Rynes SL. 2003. Corporate social and financial performance: a meta-analysis. Organization Studies 24(3): 403–441. Palmer HD, Whitten GD. 1999. The electoral impact of unexpected inflation and economic growth. British Journal of Political Science 29(4): 623–639. Porter ME. 1980. Competitive Strategy: Techniques for Analyzing Industries and Competitors. Free Press: New York. Porter ME, Kramer MR. 2002. The competitive advantage of corporate philanthropy. Harvard Business Review 80: 56–68. Porter ME, van der Linde C. 1995. Toward a new conception of the environment-competitiveness relationship. Journal of Economic Perspectives 9: 97–118. Prahalad CK, Hamel G. 1994. Strategy as a field of study: why search for a new paradigm? Strategic Management Journal Summer Special Issue 15: 5–16. Rowley T, Berman S. 2000. A brand new brand of corporate social performance. Business & Society 39(4): 397–418. Russo MV, Fouts PA. 1997. A resource-based perspective on corporate environmental performance and profitability. Academy of Management Journal 40(3): 534–559. Saiia DH, Carroll AB, Buchholtz AK. 2003. Philanthropy as strategy: when Corporate charity begins at home. Business & Society 42(2): 169–201. Sen S, Bhattacharya CB. 2001. Does doing good always lead to doing better? Consumer reactions to corporate social responsibility. Journal of Marketing Research 38: 225–243. Shane PB, Spicer BH. 1983. Market response to environmental information produced outside the firm. Accounting Review 58(3): 521–538. Sharpe WF. 1994. The Sharpe ratio. Journal of Portfolio Management 21(1): 49–59. Siegfried JJ, McElroy KM, Biernot-Fawkes D. 1983. The management of corporate contributions. Research in Corporate Performance and Policy 5: 87–102. Smith CN. 1994. The new corporate philanthropy. Harvard Business Review 72(3): 105–116. Smyth J. 2000. Guide to UK Company Giving (3rd edn). Directory of Social Change: London, UK. Turban DB, Greening DW. 1996. Corporate social performance and organizational attractiveness to prospective employees. Academy of Management Journal 40: 658–672. Ullman AA. 1985. Data in search of a theory: a critical examination of the relationship among social performance, social disclosure, and economic performance. Academy of Management Review 10(1): 540–557. Vance SC. 1975. Are socially responsible corporations good investment risks? Academy of Management Review 64(8): 18–24. Waddock SA, Graves SB. 1997. The corporate social performance-financial performance link. Strategic Management Journal 18(4): 303–319. Williamson OE. 1964. The Economics of Discretionary Behavior: Managerial Objectives in a Theory of the Firm. Prentice Hall: Englewood Cliffs, NJ. Wiseman RM, Gomez-Mejia LR. 1998. A behavioral agency model of managerial risk taking. Academy of Management Revie 23: 133–153. Wood DJ, Jones RE. 1995. Stakeholder mismatching: a theoretical problem in empirical research on corporate social performance. International Journal of Organizational Analysis 3(3): 229–267. Woolsey C. 1992. Continued growth seen in work-family benefits. Business Insurance 26: 13–14.
URI:	http://wrap.warwick.ac.uk/id/eprint/36561

Request changes to a record

Actions (login required)

View Item