Investor Horizons and Employee Satisfaction: A Test of the 'Long-Term Perspective' Vision of Corporate Social Responsibility

46 Pages Posted: 22 Aug 2016 Last revised: 3 May 2018

See all articles by Alexandre Garel

Alexandre Garel

Audencia Business School; Labex ReFi

Arthur Petit-Romec

SKEMA Business School; Université Côte d'Azur

Date Written: April 24, 2018


This paper analyzes the relationship between investor horizons and employee satisfaction. Because employee satisfaction generates substantial value over the long run, it is well suited to provide an empirical test of Bénabou and Tirole (2010)’s “long-term perspective” vision of CSR. We provide two complementary pieces of evidence supporting the idea that when CSR is about maximizing intertemporal profits, long-term investors play a critical role in promoting CSR. First, we find that long-term investor ownership is associated with employee satisfaction even after controlling for socially-responsible investor ownership. Importantly, long-term investor ownership is positively associated with both employee-friendly initiatives, which represent inputs conducive to employee satisfaction, and employee satisfaction itself measured by the presence in the list of the “Best Companies to Work for in America”. Second, unlike socially-responsible investor ownership, long-term investor ownership is not positively related to any other dimensions of CSR (e.g., environment, community, and product). Additional tests show that the association between investor horizons and employee satisfaction is not primarily due to a selection effect but rather reflects a direct influence of long-term investors.

Keywords: Corporate Social Responsibility, Employee Satisfaction, Human Capital, Investor Horizons, Institutional Investors, Intangibles

JEL Classification: G23, G32, J28, M14

Suggested Citation

Garel, Alexandre and Petit-Romec, Arthur, Investor Horizons and Employee Satisfaction: A Test of the 'Long-Term Perspective' Vision of Corporate Social Responsibility (April 24, 2018). Available at SSRN: or

Alexandre Garel (Contact Author)

Audencia Business School ( email )

8 Road Joneliere
BP 31222
Nantes Cedex 3, 44312

Labex ReFi ( email )

79 avenue de la République
Paris, 75011

Arthur Petit-Romec

SKEMA Business School ( email )

Sophia Antipolis

Université Côte d'Azur ( email )


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