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Corporate social responsibility and financial performance : The impact of the MSCI ESG ratings on Korean firms

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  • Corporate social responsibility and financial performance
  • Kim, Jinwook; Chung, Sunggon; Park, Cheongkyu
  • Korea Science


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Title Corporate social responsibility and financial performance
Similar Titles
Sub Title

The impact of the MSCI ESG ratings on Korean firms

Material Type Reports
Author(English)

Kim, Jinwook; Chung, Sunggon; Park, Cheongkyu

Publisher

[Daejeon]:Korea Science

Date 2013
Journal Title; Vol./Issue Journal of the Korea Academia-Industrial cooperation Society:Vol. 14(No. 11)
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Economic Administration
Social Development
Holding Korea Science

Abstract

This study investigates how the Corporate Social Responsibility (CSR) performance of a firm is associated with its financial performance in the stock market. Prior studies provide mixed evidence on the relation between CSR and financial performance. This study sheds some lights on the positive effect of CSR on firms’ financial performance. Using a unique set of data on CSR performance of Korean firms provided by Morgan Stanley Capital International (MCSI), we find that firms’ CSR performance is positively associated with their contemporaneous stock returns and Tobin’s Q in the Korean market. This finding suggests that stock market participants value firms’ CSR activities. This is the first study that provides empirical evidence on the existence of the positive association between the CSR performance of Korean firms and their financial performance using MCSI data which is considered more reliable than the data used in the prior CSR studies in Korea.