Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 28, 2018 erstellt
Beschreibung:
Prior literature proposes that firms can use corporate social responsibility (CSR) activities to signal their quality to investors and other stakeholders. We test this prediction by identifying exogenous situations that call for signaling. Using two independent quasi-natural experiments that impose non-fundamental-driven negative pressure on stock prices, we find that firms under such adverse circumstances engage more in CSR than otherwise similar firms. These effects are more pronounced among firms with stronger signaling needs, namely, those facing greater information asymmetry and operating in more competitive product markets. We also find evidence that signaling via CSR helps lower cost of equity capital