Corporate Sexual Equality and Firm Performance
Strategic Management Journal, Forthcoming
42 Pages Posted: 23 Nov 2016
Date Written: November 21, 2016
Previous studies have mixed findings on the relation between corporate socially responsible policies and firm performance. This paper focuses on a specific type of corporate social responsibility — corporate sexual equality, measuring how a firm treats its lesbian, gay, bisexual, and transgender (LGBT) employees, consumers, and investors — and examines whether and how it relates to firm performance. Using a longitudinal dataset of public firms in the U.S. during the period of 2002–2006, we demonstrate that firms with a higher degree of corporate sexual equality have higher stock returns and higher market valuation. We also identify one of the mediating channels, the labor market channel, that brings higher productivity to firms that embrace sexual equality.
Keywords: Corporate Sexual Equality, Firm Performance, Labor Market, LGBT, Corporate Social Responsibility
JEL Classification: G11, G12, J70, M14
Suggested Citation: Suggested Citation