For a sample comprising 36,105 U.S. firm-year observations from 1985 to 2008, we find that firms located in more religious counties enjoy cheaper equity financing costs. This result is robust to a battery of sensitivity tests, including alternative assumptions and model specifications, additional controls for noise in analyst forecasts, and various approaches to addressing endogeneity. In another set of tests, we find that the equity pricing role that religion plays comes predominantly from Mainline Protestants. We also document that the effect (...) of religiosity on firms’ cost of equity capital is larger for firms (periods) lacking alternative monitoring (regulation) mechanisms as measured by lower institutional ownership (the pre-SOX era), implying that religion plays a corporate governance role. Finally, we find that the importance of religion to equity pricing is concentrated in firms that suffer lower visibility, which tend to be more sensitive to local social and economic factors. By examining the links between religiosity and valuation at the firm level, we provide strong, robust evidence supporting the perspective that religion facilitates economic development. (shrink)

In this article, we examine the empirical association between corporate governance (CG) and corporate social responsibility (CSR) engagement by investigating their causal effects. Employing a large and extensive US sample, we first find that while the lag of CSR does not affect CG variables, the lag of CG variables positively affects firms’ CSR engagement, after controlling for various firm characteristics. In addition, to examine the relative importance of stakeholder theory and agency theory regarding the associations among CSR, CG, and corporate (...) financial performance (CFP), we also examine the relation between CSR and CFP. After correcting for endogeneity bias, our results show that CSR engagement positively influences CFP, supporting the conflict-resolution hypothesis based on stakeholder theory, but not the CSR overinvestment argument based on agency theory. Furthermore, firms’ CSR engagement with the community, environment, diversity, and employees plays a significantly positive role in enhancing CFP. (shrink)

We empirically examine the impact of corporate social responsibility (CSR) on CEO compensation using a large sample of the US firms from 1996 to 2010. We develop and test two hypotheses, the overinvestment hypothesis based on agency theory and the conflict–resolution hypothesis based on stakeholder theory. We find that the lag of CSR adversely affects both total compensation and cash compensation, after controlling for various firm and board characteristics. Our estimates show that an interquartile increase in CSR is followed by (...) a 4.35% (2.78%) decrease in total (cash) compensation. We also find an inverse association between lagged employee relations and CEO compensation. Our results are robust to the correction for endogeneity using instrumental variable approach. Taken together, our results support the conflict–resolution hypothesis, but not the CSR overinvestment argument. (shrink)

The article starts by arguing that seeing the firm as a mere nexus of contracts or as an abstract entity where different stakeholder interests concur is insufficient for a “humanistic business ethos”, which entails a complete view of the human being. It seems more appropriate to understand the firm as a human community, a concept which can be found in several sources, including managerial literature, business ethics scholars, and Catholic Social Teaching. In addition, there are also philosophical grounds that support (...) the idea of business as a human community. Extending this concept, and drawing from some Phenomenological-Personalist philosophers, we propose that the firm should be seen as a particular “community of persons” oriented to providing goods and services efficiently and profitably. Being a “community of persons” emphasizes both individuals and the whole, and makes explicit the uniqueness, conscience, free will, dignity, and openness to human flourishing. This requires appropriate communication about and participation in matters which affect people’s life, and makes it essential to cooperate for the common good of the business firm and the society. (shrink)

This study investigates the effects of internal and external corporate governance and monitoring mechanisms on the choice of corporate social responsibility (CSR) engagement and the value of firms engaging in CSR activities. The study finds the CSR choice is positively associated with the internal and external corporate governance and monitoring mechanisms, including board leadership, board independence, institutional ownership, analyst following, and anti- takeover provisions, after controlling for various firm characteristics. After correcting for endogeneity and simultaneity issues, the results show that (...) CSR engagement positively influences firm value measured by industry-adjusted Tobin’s q. We find that the impact of analyst following for firms that engage in CSR on firm value is strongly positive, while the board leadership, board independence, blockholders’ ownership, and institutional ownership play a relatively weaker role in enhancing firm value. Furthermore, we find that CSR activities that address internal social enhancement within the firm, such as employees diversity, firm relationship with its employees, and product quality, enhance the value of firm more than other CSR subcategories for broader external social enhancement such as community relation and environmental concerns. (shrink)

The purpose of this study is to examine the relationship between the corporate social performance of an organization and three variables: the size of the organization, the financial performance of the organization, and the environmental performance of the organization. By empirically testing data from 1987 to 1992, the results of the study show that a firm's corporate social performance is indeed impacted by the size of the firm, the level of profitability of the firm, and the amount of pollution emissions (...) released by the firm. (shrink)

Carroll (1991) encouraged researchers in Social Issues Management (SIM) to continue to measure Corporate Social Performance (CSP) from a variety of different perspectives utilizing a variety of different measures. In addition, Wolfe and Aupperle (1991) (and others) have asserted that there is no, single best way to measure CSP and that multiple measures and perspectives help develop the field. However, Pfeffer (1993) suggest that a lack of consistent measurement has constrained organization studies (and by implication, the field of social issues (...) management,) in its development as a field. It may be in the best interest of social issues management researchers to try to development a common body of measures and data. Recently, Kinder, Lydenberg and Domini & Co. (KLD — a social choice investment advisory firm) has made available their social performance database. The KLD data have potential to become a widely accepted set of CSP measures. The purpose of this paper is to present a construct validity study comparing the KLD data to other measures of CSP. (shrink)

There is strong theoretical support for a relationship between various characteristics of religiousness and attitudes towards business ethics. This paper examines three frequently- studied dimensions of religiousness (fundamentalism, conservatism, and intrinsic religiousness) and their ability to predict students' willingness to behave unethically. Because prior research indicated a possible relationship between the religious affiliation of an institution and its members' ethical orientation, we studied students at universities with three different types of religious affiliation: evangelical, Catholic, and none.Results of the study lend (...) support to a negative relationship between the above-mentioned dimensions of religiousness and willingness to behave unethically. In addition, students at the Evangelical university were far less willing to engage in unethical behavior than were students at either the Catholic or the unaffiliated institutions. (shrink)

Definitions of what it is to be a stakeholder are divided into "claimant" definitions requiring some sort of claim on the services of a business, "influencer" definitions requiring only a capacity to influence the workings of the business, and "combinatory" definitions allowing for either or both of these requirements. It is argued that for the purposes of business ethics, stakeholding has to be about improving the moral conduct of businesses by directing them at serving more than just the interests of (...) owners. On that basis, influencer definitions are eliminated on the grounds that they only concern morally neutral strategic considerations and combinatory definitions on the grounds that the combining of ethical and strategic considerations they promise can be less confusingly achieved through an exclusively claimant definition. It is concluded that for the purposes of business ethics, stakeholders are claimants towards whom businesses owe perfect or imperfect moral duties beyond those generally owed to people at large. (shrink)

Lynn White and others contend the dominion belief that the Bible authorizes humans to use nature to our own advantage justifies exploitation of the earth. Extreme versions of this view hold Judeo-Christian religious institutions accountable for the environmental crisis. This study assesses those arguments with original survey data from a state-wide sample. Dominion beliefs are prevalent in this sample, especially among those with little formal education or information about environmental matters. These findings are consistent with White's thesis. But, dominion beliefs (...) are not predictable on the basis of such conventional religiosity indicators as religious salience or worship frequency. These data do not show a significant association between dominion beliefs and Biblical literalism or support for creationism in schools even though deductive logic would lead one to assume such a pattern. We conclude that dominion beliefs may be a correlate of environmental apathy, but they are not significantly associated with conventional religiosity on the individual level. On the institutional level this study finds no empirical basis for singling out churches as culpable for environmental problems. Continued expansion of stewardship interpretations of faith will be well received by many church members. (shrink)

Recent research on the connection between religion and environmental concern and activism has led to divergent conclusions, with some studies finding a negative effect of religious factors, and others finding no influence or a positive effect. Using a conceptual apparatus of structuration theory, we explain how these divergent findings might be reconciled. We examine data from the 1993 General Social Survey to elaborate how religious affiliation, participation, and beliefs influence environmental concern and private and political environmental activism. Estimates from structural (...) equation models are presented to show the sometimes competing direct and indirect effects of religious affiliation, participation, and beliefs on environmental concern and private and political environmental action. (shrink)

Religious institutions are identified as important in maintaining a mastery-overnature orientation in Western culture. This orientation has presumably influenced environmental attitudes in a negative manner. Despite widespread discussion, little empirical research has been undertaken to examine these relationships. This paper identifies three alternative approaches to examining the link between religious identification and commitment, mastery-over-nature orientation, and concern for environmental problems: White's model, a denominational diversity model, and a "no difference" model. These approaches are examined empirically using data from a mail (...) survey of Washington State residents. The results indicate support for the view that Judeo-Christians are generally more committed to the mastery-over-nature orientation than non-Judeo-Christians, but that this commitment varies considerably among denominations. Furthermore, commitment to the mastery-over-nature orientation is instumental in shaping concern for environmental problems. (shrink)

Using a national sample of Americans we examined the relationships between three measures of religiosity and three attitudes about the environment. We controlled for education, age, gender, and region. Without controls, we found that religious individuals were less likely than nonreligious individuals to support additional federal spending to protect the environment. Church attendance and being born again predicted willingness to relax environmental controls for the sake of economic growth. None of the religious variables predicted identification as an environmentalist. The addition (...) of controls minimized the effects of the religious variables upon willingness to support environmental protection and to relax environmental regulations. Overall, our interpretation of these findings challenges the dominant view that those in Judeo-Christian traditions--particularly religiously conservative individuals in these traditions--are less concerned about environmental issues than are other individuals. (shrink)

Lynn White's thesis, that the disenchantment of nature in the first chapter of Genesis led to reduced concern for the environment in the West, has received little empirical research at the level of individual differences in religious experience. In this study, we separated the effects of four different measures of religious experience on four different indexes of concern for the environment. Results offered substantial support for White's thesis: belief in the Bible, and only belief in the Bible, predicted scores on (...) all four indexes of environmental concern and did so in the direction expected by White's thesis; this occurred independently of the effects of background items; standard regression showed the effects of belief in the Bible to be independent of those of other measures of religious involvement on two indexes, and on the other two indexes stepwise regression showed the same thing; and in only two of twelve cases did any other measure of religious experience significantly predict an index score independently of belief in the Bible. (shrink)

Conservative Christian theology contains a set of beliefs that run counter to the philosophy supporting environmentalism. Conservative eschatology, religious tradition, and religious commitment should be negatively related to support for environmental policy. Using data from four national surveys of clergy, religious activists, political-party contributors, and the mass public, we analyze the impact of religious variables on attitudes toward environmental protection. We find that conservative eschatology, religious tradition, and religious commitment all have strong bivariate associations with environmentalism. In multivariate analyses, however, (...) conservative eschatology proves by far the strongest religious predictor of environmental perspectives, although other measures exert occasional influence. (shrink)

Religion and faith are often central aspects of an individual’s self-concept, and yet they are typically avoided in the workplace. The current study seeks to replicate the findings about the role of religious beliefs and practices in shaping an employee’s reactions to stress/burnout and job attitudes. Second, we extend the literature on faith in the workplace by investigating possible relationships between religious beliefs and practices and citizenship behaviors at work. Third, we attempted to study how one’s perceived freedom to express (...) his/her religious identity at work was related to workplace attitudes and behaviors. Mixed results suggest that religiosity can be related to stress and burnout, job satisfaction, organizational commitment, and Organizational Citizenship Behavior. More research is needed to further qualify the results and explore the effects of one’s perceived freedom to express his/her religious identity in the workplace. (shrink)

This paper explores the relationship between religious denomination and individual attitudes to Corporate Social Responsibility (CSR) within the context of a large sample of over 17,000 individuals drawn from 20 countries. We address two general questions: do members of religious denominations have different attitudes concerning CSR than people of no denomination? And: do members of different religions have different attitudes to CSR that conform to general priors about the teachings of different religions? Our evidence suggests that, broadly, religious individuals do (...) not prioritise the responsibilities of the firm differently, but do tend to hold broader conceptions of the social responsibilities of businesses than non-religious individuals. However, we show that this neither true for all religious groups, nor for all areas of CSR. (shrink)

The purpose of this study is to examine the relationship between the corporate social performance of an organization and three variables: the size of the organization, the financial performance of the organization, and the environmental performance of the organization. By empirically testing data from 1987 to 1992, the results of the study show that a firm's corporate social performance is indeed impacted by the size of the firm, the level of profitability of the firm, and the amount of pollution emissions (...) released by the firm. (shrink)

We argue that corporate social performance (CSP) has become a legitimizing identity (brand) for researchers in the business and society field, but it has not developed into a viable theoretical or operational construct. Because measuring CSP is contingent on the operational setting (industry, issues, etc.), it is difficult to produce worthwhile comparisons across studies or generalizing beyond the boundaries of a specific study. The authors suggest that researchers remove the CSP label from their operational variables, and instead narrowly define their (...) studies in operational terms. They provide aworking example of the proposed research direction by examining the theory underlying the popular CSP–financial performance (FP) debate. In the authors’ conceptualization, stakeholder action provides the underlying logic connecting CSP-FP, and we recast the research question to investigate the conditions under which stakeholders will take action to influence the focal organization and when those actions will influence the CSP-FP link. (shrink)