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Corporate social responsibility disclosure and firm value: a signaling theory perspective

Author

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  • Van Ha Nguyen

Abstract

Purpose - This study investigates the impact of corporate social responsibility (CSR) disclosure on firm value and the moderating roles of largely under-examined contextual factors such as mandatory disclosure policy, industry profile and local institutional environment. Design/methodology/approach - Panel data techniques are used to investigate the association between CSR disclosure and firm value as well as the roles of such intervening factors. Findings - The study finds that CSR disclosure is positively related to firm value, indicating the financial benefit of CSR disclosure. Moreover, the positive relationship is more pronounced in the post-mandatory CSRD period, non-high-profile industries and more favorable institutional environment. Practical implications - The study provides corporate managers with more insight into the beneficial effects of CSR disclosure and the contingency factors influencing the CSR disclosure–firm value relationship. Originality/value - This study advances the extant knowledge of contingent effects on the market valuation of CSR reporting from a signaling theory perspective. Developing a theory to explain the relationship between CSR disclosure and firm value, this study adds arguments and empirical evidence to demonstrate that the effectiveness of CSR disclosure as a signal depends on the signaler, the receiver and the signaling environment.

Suggested Citation

  • Van Ha Nguyen, 2025. "Corporate social responsibility disclosure and firm value: a signaling theory perspective," Journal of Economics and Development, Emerald Group Publishing Limited, vol. 27(2), pages 114-128, April.
  • Handle: RePEc:eme:jedpps:jed-02-2024-0067
    DOI: 10.1108/JED-02-2024-0067
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    More about this item

    Keywords

    Corporate social responsibility; Firm value; High-profile industry; Institutional environment; Mandatory CSR disclosure; G30; G32; G34; M14;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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