Corporate Social Responsibility and Credit Risk

11 Pages Posted: 22 Oct 2020

See all articles by Christina E. Bannier

Christina E. Bannier

Justus-Liebig-University Giessen

Yannik Bofinger

Justus Liebig University Giessen

Björn Rock

Justus Liebig University Giessen

Date Written: September 3, 2020

Abstract

We study the effects of corporate social responsibility on credit risk for U.S. and European firms over the period 2003 to 2018. Differentiating between the various facets of corporate social responsibility shows that only environmental aspects reduce different measures of credit risk for U.S. firms, whereas both environmental and social aspects do so for European firms. Surprisingly, we find that credit ratings do not reflect these credit-risk reducing effects of corporate social responsibility. Our results are robust against different estimation methods.

Keywords: Corporate social responsibility, ESG, sustainability, credit risk, credit rating

JEL Classification: G11, G32, G34, O16, Q56

Suggested Citation

Bannier, Christina E. and Bofinger, Yannik and Rock, Björn, Corporate Social Responsibility and Credit Risk (September 3, 2020). Available at SSRN: https://ssrn.com/abstract=3686025 or http://dx.doi.org/10.2139/ssrn.3686025

Christina E. Bannier

Justus-Liebig-University Giessen ( email )

Licher Str. 62
Gießen, 35394
Germany
+49 641 99 22551 (Phone)

Yannik Bofinger (Contact Author)

Justus Liebig University Giessen ( email )

Licher Str. 64
Giessen, 35394
Germany

Björn Rock

Justus Liebig University Giessen ( email )

Licher Str. 64
Giessen, 35394
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
339
Abstract Views
1,153
Rank
135,955
PlumX Metrics