The impact of the dimensions of social performance on firm risk

Kais Ben Hmida Bouslah, Lawrence Kryzanowski, Bouchra M'Zali

Research output: Contribution to journalArticlepeer-review

118 Citations (Scopus)

Abstract

This paper examines the impact of the individual dimensions of social performance (SP) on firm risk (total and idiosyncratic) using 16,599 firm-year observations over the period 1991–2007. We find that firm risk for S&P500 members is positively affected by Employee, Diversity, and Corporate Governance concerns. On the other hand, Community (Diversity) strengths negatively (positively) affect their risk. As to non-S&P500 members, firm risk is positively affected by Employee concerns and Diversity strengths. However, firm risk of non-S&P500 members is negatively affected by Environment strengths. The direction of causation between firm risk and SP depends on the dimension examined.
Original languageEnglish
Pages (from-to)1258–1273
JournalJournal of Banking & Finance
Volume37
Issue number4
Early online date25 Dec 2012
DOIs
Publication statusPublished - Apr 2013

Keywords

  • Volatility; Idiosyncratic risk; Social performance; Strengths; Concerns

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