Abstract

http://ssrn.com/abstract=2143259
 
 

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Signaling Through Corporate Accountability Reporting


Thomas Z. Lys


Northwestern University - Kellogg School of Management

James P. Naughton


Northwestern University - Kellogg School of Management

Clare Wang


Northwestern University - Kellogg School of Management

December 12, 2013


Abstract:     
We document that corporate social responsibility (“CSR”) expenditures are not a form of corporate charity nor do they improve future financial performance. Rather, firms undertake CSR expenditures in the current period when they anticipate stronger future financial performance. We show that the causality of the positive association between CSR expenditures and future firm performance is different from what is claimed in the vast majority of the literature, and that corporate accountability disclosures are another channel by which firms convey private information about future financial prospects to outsiders.

Number of Pages in PDF File: 41

Keywords: Corporate Accountability Reporting, Corporate Social Responsibility, Voluntary Disclosure, Signaling

JEL Classification: M41, D82, G14, G30, G32, G34

working papers series


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Date posted: September 7, 2012 ; Last revised: January 17, 2014

Suggested Citation

Lys, Thomas Z. and Naughton, James P. and Wang, Clare, Signaling Through Corporate Accountability Reporting (December 12, 2013). Available at SSRN: http://ssrn.com/abstract=2143259 or http://dx.doi.org/10.2139/ssrn.2143259

Contact Information

Thomas Z. Lys
Northwestern University - Kellogg School of Management ( email )
2001 Sheridan Road
Department of Accounting & Information Systems
Evanston, IL 60208
United States
847-491-2673 (Phone)
847-467-1202 (Fax)
James P. Naughton (Contact Author)
Northwestern University - Kellogg School of Management ( email )
2001 Sheridan Road
Evanston, IL 60208
United States
Clare Wang
Northwestern University - Kellogg School of Management ( email )
2001 Sheridan Road
Evanston, IL 60208
United States
847 491 2670 (Phone)
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