Cross-Listing and Corporate Social Responsibility
48 Pages Posted: 12 Oct 2015 Last revised: 15 Aug 2016
Date Written: August 2016
This paper investigates the dynamics of cross-listing and corporate social responsibility (CSR). Using a sample of 10,815 firm-year observations from 54 countries over the period 2002–2011, we find that cross-listed firms have better CSR performance than non–cross-listed domestic firms. This result is robust to endogeneity and different types of cross-listing. We also find that CSR increases (decreases) significantly after cross-listing in (delisting from) U.S. markets. The positive impact of cross-listing on CSR performance is stronger for firms from countries with weaker institutions, lower country-level sustainability, and higher liability of foreignness, and for firms operating in industries with high litigation risk. Finally, we find that cross-listed firms with better CSR performance exhibit higher valuations.
Keywords: Cross-listing, corporate social responsibility (CSR), bonding theory, institutions
JEL Classification: G15, G34, M14
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