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The relationship between ex‐ante cost of equity capital and corporate social responsibility in introductory and maturity period
Author(s) -
Chen Roger C.Y.,
Lee ChenHsun,
Hung ShihWei
Publication year - 2019
Publication title -
corporate social responsibility and environmental management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.519
H-Index - 73
eISSN - 1535-3966
pISSN - 1535-3958
DOI - 10.1002/csr.1867
Subject(s) - corporate social responsibility , ex ante , business , maturity (psychological) , cost of capital , cost of equity , equity (law) , accounting , social responsibility , economics , finance , public relations , profit (economics) , microeconomics , political science , macroeconomics , law
In the long term, the relationship between corporate social responsibility (CSR) and ex‐ante cost of equity capital is inconsistent. This study explores the association with corporate social responsibility, ex‐ante cost of equity capital, and operating performance forecasting with analysts. We also separate the research period into introductory period and maturity period to examine this study. The results find that sound corporate social responsibility policy, more information transparency of CSR, and creating interaction with stakeholders are reduced ex‐ante cost of equity capital to increase operating performance, and analysts give more positive forecast or better evaluation. On the other hand, we also find that the engagement on CSR is motivational factors in introductory period to become the hygiene factors on firms' management in maturity period.