In this study, we explore the differential impact of two dimensions of corporate social responsibility (CSR), environmental CSR and social CSR, on firm capital market-based valuation. Using manually collected actual firm-level CSR expenditure data, we find that relative to social, greater monetary expenditure on environmental CSR projects leads to a higher market valuation of the firm. We establish this causality by exploiting a mandatory CSR regulation in India as an exogenous shock. The results of the quasi-natural experiment validate that when a CSR-mandated firm spends more on environmental CSR than social CSR, it increases the firm value. Further, we find that the valuation impact is more significant when a CSR-mandated firm spends more on environmental CSR in a state other than its registered state.
| Date of Award | 16 Feb 2023 |
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| Original language | English |
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| Awarding Institution | - University Of Strathclyde
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| Sponsors | University of Strathclyde |
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