TY - JOUR
T1 - Institutional ownership stability and corporate social performance
AU - Wang, Kun Tracy
AU - Sun, Aonan
N1 - Publisher Copyright:
© 2022
PY - 2022/6
Y1 - 2022/6
N2 - We examine the influence of institutional ownership stability on corporate social performance (CSP). We find that stable institutional ownership is associated with higher CSP, after controlling for the percentage of institutional ownership. The result is robust to alternative measures of CSP and various techniques to address endogeneity concerns. Additional analysis shows that this positive relation is driven by prudent institutional investors and by CSP dimensions directly pertinent to a specific, primary stakeholder group. Overall, we show that stable institutional investors are an effective mechanism to promote firms’ investment in long-term-oriented activities including CSR.
AB - We examine the influence of institutional ownership stability on corporate social performance (CSP). We find that stable institutional ownership is associated with higher CSP, after controlling for the percentage of institutional ownership. The result is robust to alternative measures of CSP and various techniques to address endogeneity concerns. Additional analysis shows that this positive relation is driven by prudent institutional investors and by CSP dimensions directly pertinent to a specific, primary stakeholder group. Overall, we show that stable institutional investors are an effective mechanism to promote firms’ investment in long-term-oriented activities including CSR.
KW - Corporate social performance
KW - Corporate social responsibility
KW - Institutional ownership stability
KW - Long-term orientation
UR - http://www.scopus.com/inward/record.url?scp=85127797086&partnerID=8YFLogxK
U2 - 10.1016/j.frl.2022.102861
DO - 10.1016/j.frl.2022.102861
M3 - Article
SN - 1544-6123
VL - 47
JO - Finance Research Letters
JF - Finance Research Letters
M1 - 102861
ER -