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The Impact of Labor Union Influence on Corporate Social Responsibility

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  • Hong-Min Chun

    (School of Business, Chungbuk National University, Cheongju-si 28644, Korea)

  • Sang-Yi Shin

    (School of Business, Chungbuk National University, Cheongju-si 28644, Korea)

Abstract

This study examines the effects of labor union influence on the corporate social responsibility ( CSR ) of Korean firms, which is regarded as a pertinent sustainable factor to meet the various demands of the organizations around a firm. Further, this paper implies that labor unions might be part of a group of stakeholders that affect firms’ CSR activity. The empirical results suggest labor union existence as well as the labor unionization ratio is negatively associated with firms’ CSR activity. Additionally, this negative association is more pronounced for non-owner manager firms. Additional robustness tests using quantile regression, two-stage least squares (2SLS) regression, and the Heckman two-step analysis support the above findings. Therefore, we conclude that labor unions might cooperate with non-owner managers to decrease firms’ CSR activity because decreasing CSR expenditure makes for a favorable wage negotiation process that advocates labor unions’ rent seeking behavior and non-owner managers’ agreement with labor unions in terms of business performance during their tenure.

Suggested Citation

  • Hong-Min Chun & Sang-Yi Shin, 2018. "The Impact of Labor Union Influence on Corporate Social Responsibility," Sustainability, MDPI, vol. 10(6), pages 1-17, June.
    • Handle: RePEc:gam:jsusta:v:10:y:2018:i:6:p:1922-:d:151403
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    References listed on IDEAS

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    Cited by:

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    3. Fabricio Carlos Schmidt & Roselaine Ruviaro Zanini & André Luis Korzenowski & Reno Schmidt Junior & Karl Benchimol Xavier do Nascimento, 2018. "Evaluation of Sustainability Practices in Small and Medium-Sized Manufacturing Enterprises in Southern Brazil," Sustainability, MDPI, vol. 10(7), pages 1-11, July.
    4. Almer Villajos & Cristina García-Ael & Gabriela Topa, 2019. "Job Crafting among Labor Union Representatives: Its Impact on Work Engagement and Job Satisfaction," Social Sciences, MDPI, vol. 8(1), pages 1-11, January.
    5. Unsal, Omer, 2024. "Employee lawsuits and business downsizing: Evidence from labor unions," Journal of Financial Stability, Elsevier, vol. 74(C).
    6. Alipranti, Maria & Manasakis, Constantine & Petrakis, Emmanuel, 2024. "Corporate social responsibility and bargaining in unionized markets," Journal of Economic Behavior & Organization, Elsevier, vol. 224(C), pages 949-965.
    7. Hong-Min Chun & Sang-Yi Shin, 2018. "Does Analyst Coverage Enhance Firms’ Corporate Social Performance? Evidence from Korea," Sustainability, MDPI, vol. 10(7), pages 1-16, July.
    8. Qiang Liu & Guoqing Ge & Chong Ning & Xiaobo Tao & Yongbo Sun, 2018. "Do Private Benefits of Control Affect Corporate Social Responsibility? Evidence from China," Sustainability, MDPI, vol. 10(9), pages 1-19, September.

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