Impact of CSR on Shareholder Value

How does corporate social responsibility (CSR) impact shareholder value? Drawing on the results of one of his studies, Professor Hariom Manchiraju explains that shareholders of companies that are required by regulation to spend on CSR tend to experience negative stock-market reaction. Regulation that makes CSR compulsory tends to make shareholders view CSR as being burdensome and not in their best financial interests.

Professor Hariom Manchiraju is an Assistant Professor in the Accounting area at the Indian School of Business.

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