The influence of corporate philanthropic donations on private investors' valuation judgments: Experimental evidence

Theis J, Nipper M, Meier M (2023)

Publication Type: Journal article

Publication year: 2023

Journal

Corporate Social Responsibility and Environmental Management Wiley-Blackwell

Book Volume: 31

Pages Range: 540-554

DOI: 10.1002/csr.2584

Abstract

Corporate donations towards disaster relief efforts, often called corporate philanthropic disaster relief (CPDR), are commonplace practice and one critically observed subcategory of CSR, with high visibility in the global media. We investigate whether private investors value firms differently based on their perception of firm's engagement in CPDR. Therefore, we created an experimental investment scenario in which we manipulate the magnitude of a hypothetical Firm Y's CPDR efforts to evaluate investment decisions of private investors recruited from Amazon's Cloud Research platform. Our findings suggest that higher CPDR generally affects private investors' assessment of a firm's value positively. Using a structural equation model and the CSR skepticism concept to examine private investors motive attribution to firms' CPDR, we find that private investors perceive high CPDR as an indicator for honest and values-driven corporate social behavior and a low CPDR as an ingratiating attempt to win favor. Thus, we extend prior research by unveiling through which channels of impact CPDR potentially affects firm value and find an explanation why CPDR can have adverse effects on firm value.

Authors with CRIS profile

Marvin Nipper

Additional Organisation(s)

Juniorprofessur für Sustainability Reporting

Involved external institutions

University of Southern Denmark / Syddansk Universitet DK Denmark (DK) Universität Duisburg-Essen (UDE) DE Germany (DE)

How to cite

APA:

Theis, J., Nipper, M., & Meier, M. (2023). The influence of corporate philanthropic donations on private investors' valuation judgments: Experimental evidence. Corporate Social Responsibility and Environmental Management, 31, 540-554. https://dx.doi.org/10.1002/csr.2584

MLA:

Theis, Jochen, Marvin Nipper, and Marco Meier. "The influence of corporate philanthropic donations on private investors' valuation judgments: Experimental evidence." Corporate Social Responsibility and Environmental Management 31 (2023): 540-554.

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