THE IMPACT OF CORPORATE SOCIAL RESPONSIBILITYON INVESTMENT RECOMMENDATIONS
London Business SchoolGeorge Serafeim
Harvard Business SchoolAugust, 2010
Best Paper Proceedings, Academy of Management 2010Social Issues in Management (SIM) Division)
Using a large sample of publicly traded US firms over 16 years, we investigate theimpact of corporate socially responsible (CSR) strategies on security analysts’recommendations. Socially responsible firms receive more favorablerecommendations in recent years relative to earlier ones, documenting a changingperception of the value of such strategies by the analysts. Moreover, we find thatfirms with higher visibility receive more favorable recommendations for their CSRstrategies and that analysts with more experience, broader CSR awareness or thosewith more resources at their disposal, are more likely to perceive the value of CSRstrategies more favorably. Our results document how CSR strategies can affectvalue creation in public equity markets through analyst recommendations.
Assistant Professor of Strategic and International Management, London Business School, Regent’s Park, NW1 4SA, London,United Kingdom. Email: firstname.lastname@example.org, Ph: +44 20 7000 8748, Fx: +44 20 7000 7001.
Assistant Professor of Business Administration, Harvard Business School, Soldiers’ Field Road, Morgan Hall 381, 02163Boston, MA, USA. Email:email@example.com, Ph: +1 617 495 6548, Fx: +1 617 496 7387.We are grateful to Constantinos Markides, and seminar participants at the research brown bag (SIM area) of the London BusinessSchool, the academic conference on Social Responsibility at University of Washington - Tacoma, the 2010 European Academyof Management Conference, and the 2010 Academy of Management Conference. Ioannou acknowledges financial support fromthe Research and Materials Development Fund (RAMD) at the London Business School. All remaining errors are our own.