CSR and Market Valuation: International Evidence

Marsat, Sylvain; Williams, Benjamin

doi:10.2139/ssrn.1833581

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CSR and Market Valuation: International Evidence

International Conference of the French Finance Association (AFFI), May 11-13, 2011

22 Pages Posted: 9 May 2011 Last revised: 25 Nov 2013

See all articles by Sylvain Marsat

Benjamin Williams

Université Clermont Auvergne

Date Written: March 1, 2011

Abstract

Do socially responsible firms benefit from ethical goodwill? On the one hand, taking externalities into account can be a competitive disadvantage. On the other hand, financial benefits may result from ethical behavior. Thanks to a worldwide dataset of ESG ratings (MSCI ESG ratings), we examine the relationship between a firm’s CSR rating and its value. After controlling for industry, region, year and R&D, we observe, contrary to mainstream empirical studies, strong evidence of a negative impact of responsible behavior on corporate market value.

Keywords: Corporate Social Responsibility, ESG Rating, Firm valuation, Tobin’s q

JEL Classification: G11, G12

Suggested Citation: Suggested Citation

Marsat, Sylvain and Williams, Benjamin, CSR and Market Valuation: International Evidence (March 1, 2011). International Conference of the French Finance Association (AFFI), May 11-13, 2011, Available at SSRN: https://ssrn.com/abstract=1833581 or http://dx.doi.org/10.2139/ssrn.1833581