Empirical study on relationship between corporate social responsibility and financial performance in Korea

By Jae-Joon Han, Hyun Jeong Kim, Jeongmin Yu. Asian Journal of Sustainability and Social Responsibility, 2016

223 citations recorded by the source corpus.

There have been numerous studies on corporate social responsibility (CSR) and its relation to corporate performance. Recently, studies in this field have paid particular attention to the method of measurement in order to identify the CSR activities. One of the widely recognized measures to proxy CSR is the Environmental, Social, and Governance (ESG) score. This paper examines the relationship between Corporate Social Responsibility (CSR) and corporate profit by testing the ESG performance score on the firm’s Financial Performance (FP), specifically for Korea Stock Market (KOSPI) listed firms in the period of 2008 ~ 2014. We use three separate individual Environmental, Social and Corporate Governance (ESG) disclosure scores from Bloomberg for the CRS proxy measure, as well as the Return on Equity (ROE), Market-to-Book Ratio (MBR) and Stock Return for the FP measures. We found that the ESG disclosure scores (the measures of environmental, social, and governance responsibility performance) in the Korean corporations shows diversified results. Particularly, the environmental responsibility performance score presents a negative (or U curve) relationship with FP, whereas the governance responsibility performance score presents a positive (or inverse U curve) relationship with FP. On the other hand, we did not find any statistically significant evidence of a relationship between the social responsibility performance score and FP.

Subfields: Management Science and Operations Research, Marketing, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/c611aaa20af6a817e8d4b5e708bb9147a6744db3

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In Management Science and Operations Research

1. Ryan Byun
2. Bohyun Yoon
3. J. Lee

In Marketing

1. Ryan Byun
2. Bohyun Yoon
3. J. Lee
4. H. Al‐Shaer

In Strategy and Management

1. Ryan Byun
2. Bohyun Yoon
3. J. Lee
4. H. Al‐Shaer

Citations in the corpus

• Does ESG Performance Enhance Firm Value? Evidence from Korea (2018, methodology): “Even with quantified data, CSR performances are difficult to compare among peers and across periods [4,6].”