Publication Type
Journal Article
Version
acceptedVersion
Publication Date
1-2015
Abstract
This study posits that security analysts heed corporate social performance information and factor it into their recommendations to general investors. In particular, as corporate social performance is often uncertain and ambiguous to general investors, analysts may serve as the informational pathway connecting corporate social performance to firm stock returns. Thus, we argue that analyst recommendations mediate the relationship between corporate social performance and firm stock returns. On the basis of not only a qualitative study with literature searches and interviews of stock analysts but also a quantitative study with two longitudinal samples of large firms, we find support for these arguments. Our findings uncover an information-based underlying mechanism for the link between corporate social performance and financial performance.
Keywords
Corporate social performance, financial analysts, stock recommendations, stock returns
Discipline
Business Law, Public Responsibility, and Ethics | Portfolio and Security Analysis | Strategic Management Policy
Research Areas
Strategy and Organisation
Publication
Strategic Management Journal
Volume
36
Issue
1
First Page
123
Last Page
136
ISSN
0143-2095
Identifier
10.1002/smj.2219
Publisher
Wiley
Citation
LUO, Xueming; WANG, Heli; RAITHEL, Sascha; and ZHENG, Qinqin.
Corporate social performance, analyst stock recommendations, and firm future returns. (2015). Strategic Management Journal. 36, (1), 123-136.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/3579
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1002/smj.2219
Included in
Business Law, Public Responsibility, and Ethics Commons, Portfolio and Security Analysis Commons, Strategic Management Policy Commons