Do Firms Manage Their CSR Reputation? Evidence from Twitter
44 Pages Posted: 29 Oct 2019
Richard M. Crowley
Singapore Management University - School of Accountancy
Wenli Huang
Hong Kong Polytechnic University
Hai Lu
University of Toronto - Rotman School of Management
Wei Luo
Peking University - Guanghua School of Management
Date Written: October 20, 2019
Abstract
Using a machine learning approach to process 11 million tweets posted by S&P 1500 firms from 2011 through 2016, we find that poor corporate social responsibility (CSR) performance firms tweet more about CSR activities and use tweets that are shorter, and with more passive voice and extreme tone. Good CSR performance firms tweet less about CSR, yet gain twice more followers per CSR tweet than poor CSR performance firms. Good CSR performance firms also experience a greater decrease in institutional ownership along with higher increases in bid-ask spread and stock return volatility after joining Twitter than do poor CSR performance firms. Our findings suggest that poor CSR performance firms play a greenwashing strategy, but this strategy is not effective in leading to capital market consequences.
Keywords: Social media, Twitter, Dissemination, Corporate social responsibility, Prosocial
JEL Classification: G14, L30, M14, M15, M40
Suggested Citation: Suggested Citation
Richard M. Crowley
Singapore Management University - School of Accountancy ( email )
60 Stamford Road
Singapore 178900
Singapore
HOME PAGE: http://rmc.link
Wenli Huang
Hong Kong Polytechnic University ( email )
School of Accounting and Finance
Hung Hom, Kow Loon, Hong Kong
Hong Kong
Hai Lu (Contact Author)
University of Toronto - Rotman School of Management ( email )
105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada
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