The Corporate Social Performance and Corporate Financial Performance Debate: Twenty-Five Years of Incomparable Research

Griffin, J. J., and Mahon, J. F., 1997. "The Corporate Social Performance and Corporate Financial Performance Debate : Twenty-Five Years of Incomparable Research," Business & Society, Vol. 36, (5): 5-31

28 Pages Posted: 20 May 2013

See all articles by Jennifer Griffin

Jennifer Griffin

George Washington University

John F. Mahon

University of Maine; University of Maine - School of Business

Date Written: May 19, 2013

Abstract

This article extend earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencies. Research in this area is extended in three critical areas. First, it focuses on a particular industry, the chemical industry. Second, it use multiple sources of data -- two that are perceptually based (KLD Index and Fortune reputation survey), and two that are performance based (TRI database and corporate philanthropy) in order to triangulate toward assessing corporate social performance. Third, it use the five most commonly applied accounting measures in the corporate social performance and corporate financial performance (CSP/CFP) to assess corporate financial performance. The results indicate that the a priori use of measures may actually predetermine the CSP/CFP relationship outcome. Surprisingly, Fortune and KLD Indices very closely track one another, whereas TRI and corporate philanthropy differentiate between high and low social performers and do not correlate to the firm's financial performance.

Keywords: Corporate Social Performance, Corporate Financial Performance, Methodology, Multiple Data sources, chemical industry

JEL Classification: M10, M14, M19

Suggested Citation

Griffin, Jennifer and Mahon, John F., The Corporate Social Performance and Corporate Financial Performance Debate: Twenty-Five Years of Incomparable Research (May 19, 2013). Griffin, J. J., and Mahon, J. F., 1997. "The Corporate Social Performance and Corporate Financial Performance Debate : Twenty-Five Years of Incomparable Research," Business & Society, Vol. 36, (5): 5-31. Available at SSRN: https://ssrn.com/abstract=2267176

Jennifer Griffin

George Washington University ( email )

Washington, DC 20052
United States

John F. Mahon (Contact Author)

University of Maine ( email )

Orono, ME 04469
United States
207-581-1967 (Phone)

University of Maine - School of Business ( email )

United States

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