Evidence on the trade-off between corporate social responsibility and mergers and acquisitions investment

Krishnamurti, Chandrasekhar and Shams, Syed and Chowdhury, Hasibul (2021) Evidence on the trade-off between corporate social responsibility and mergers and acquisitions investment. Australian Journal of Management, 46 (3). pp. 466-498. ISSN 0312-8962


Abstract

In this article, we investigate whether there is a trade-off between corporate social responsibility (CSR) and mergers and acquisitions (M&A) investments. Consistent with conflict resolution view of stakeholder theory, our results document a negative relationship between CSR scores and M&A activity. We further show that the tendency of CSR firms’ low engagements in M&A investmen ts is valid only for firms with no slack. We also find that firms choosing to trade off pay a lower bid premium to targets to create value for acquiring shareholders. These findings are robust to several alternative proxies and endogeneity tests.


Statistics for USQ ePrint 39545
Statistics for this ePrint Item
Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Faculty/School / Institute/Centre: Historic - Faculty of Business, Education, Law and Arts - School of Commerce (1 Jul 2013 - 17 Jan 2021)
Faculty/School / Institute/Centre: Historic - Faculty of Business, Education, Law and Arts - School of Commerce (1 Jul 2013 - 17 Jan 2021)
Date Deposited: 14 Sep 2020 04:04
Last Modified: 14 Jul 2021 01:29
Uncontrolled Keywords: Corporate social responsibility, mergers and acquisitions, stakeholder theory, trade-off theory
Fields of Research (2008): 15 Commerce, Management, Tourism and Services > 1502 Banking, Finance and Investment > 150201 Finance
Fields of Research (2020): 35 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 3502 Banking, finance and investment > 350202 Finance
Identification Number or DOI: https://doi.org/10.1177/0312896220950394
URI: http://eprints.usq.edu.au/id/eprint/39545

Actions (login required)

View Item Archive Repository Staff Only