In this article, we examine the empirical association between corporate governance (CG) and corporate social responsibility (CSR) engagement by investigating their causal effects. Employing a large and extensive US sample, we first find that while the lag of CSR does not affect CG variables, the lag of CG variables positively affects firms’ CSR engagement, after controlling for various firm characteristics. In addition, to examine the relative importance of stakeholder theory and agency theory regarding the associations among CSR, CG, and corporate (...) financial performance (CFP), we also examine the relation between CSR and CFP. After correcting for endogeneity bias, our results show that CSR engagement positively influences CFP, supporting the conflict-resolution hypothesis based on stakeholder theory, but not the CSR overinvestment argument based on agency theory. Furthermore, firms’ CSR engagement with the community, environment, diversity, and employees plays a significantly positive role in enhancing CFP. (shrink)

Some argue that managers over-invest in corporate social responsibility (CSR) activities to build their personal reputations as good global citizens. Others claim that CEOs strategically choose CSR activities to reduce the probability of CEO turnover in a future period through indirect support from activists. Still others assert that firms use CSR activities to signal their product quality. We find that firms use governance mechanisms, along with CSR engagement, to reduce conflicts of interest between managers and non-investing stakeholders. Employing a large (...) and extensive sample of firms within Russell 2000, S& 500 and Domini 400 indices during the 1993-2004 period, we find that consistent with the conflict-resolution hypothesis, the CSR choice is positively associated with governance characteristics, including board independence, institutional ownership, and analyst following. In addition, after correcting for endogeneity of CSR engagement, our results show that CSR engagement positively influences operating performance and firm value, supporting the conflict-resolution hypothesis as opposed to the over-investment and strategic-choice arguments. We find only a weak support of the product-signaling hypothesis as a major motive of CSR engagement. (shrink)

This study examines the relation between corporate social responsibility and institutional investor ownership, and the impact of this relation on stock return volatility. We find that institutional ownership does not strictly increase or decrease in CSR; rather, institutional ownership is a concave function of CSR. This evidence suggests that institutional investors do not see CSR as strictly value-enhancing activities. Institutional investors adjust their percentage of ownership when CSR activities go beyond the perceived optimal level. Employing the path analysis, we also (...) examine the mediating effect of institutional ownership on the relation between CSR and stock return volatility. We find that CSR decreases stock return volatility at a decreasing rate through its effect on institutional ownership. Our results remain robust under several different CSR measures and estimation methods. (shrink)

This study examines how the sell-side analysts interpret firms’ corporate social responsibility activities. Specifically, we examine the differential impact of overall, legal, and normative CSR on the analysts’ earnings forecast dispersion, stock return volatility, cost of equity capital, and firm value. Employing a sample of U.S. public firms during 1993–2009, we find that overall CSR intensities reduce analyst dispersion of earnings forecast, volatility of stock return and cost of capital , and increase firm value. However, its impact is reduced for (...) firms with better accounting and disclosure quality. When we disaggregate CSR into legal and normative CSR, we find that legal CSR decreases analysts’ dispersion, stock return volatility, and COC, while legal CSR increases firm value. The sell-side analysts tend to have less information asymmetry regarding the net benefits of pursuing CSR that is required by laws. We find, however, that the benefit of having normative CSR realized in 1 year lag such that analyst dispersion, stock return volatility, COC decrease, respectively, and firm value increases. Furthermore, we find that the benefit of normative CSR is offset for firms with higher accounting and disclosure quality. (shrink)

This article examines the empirical association between analyst coverage and corporate social responsibility (CSR) by investigating their simultaneous and causal effects, and its joint effects of CSR engagement and analyst coverage on firm risk. We find a positive association between the level and change of CSR engagement and the level and change of analyst coverage after considering simultaneity and causality. Based on the first-difference approach, we further find that the change in analyst following from the previous year affects the change (...) in CSR in the current period, whereas the change in CSR from the previous period does not influence the change in analyst following in the current period. Furthermore, we find that the change in CSR engagement as well as the interaction effect of changes in CSR and analyst coverage reduces the change of firm risk. When we examine the CSR strengths and concerns separately, analyst following does not significantly influence firms’ CSR strength but CSR concern activities decreases significantly as firms have more analyst followings. We further find the mediating role of financial analysts between CSR concerns (but not CSR strengths) and firm risk. We maintain that analysts provide indirect but additional social pressure to the firms to eventually reduce their irresponsible activities. Taken together, we interpret these results to support the stakeholder theory-based conflict-resolution explanation that considers CSR engagement as a vehicle to reduce conflicts of interest between managers and noninvesting stakeholders but not the overinvestment hypothesis that views CSR as a waste of valuable resources at the cost of shareholders. (shrink)

This study investigates the effects of internal and external corporate governance and monitoring mechanisms on the choice of corporate social responsibility (CSR) engagement and the value of firms engaging in CSR activities. The study finds the CSR choice is positively associated with the internal and external corporate governance and monitoring mechanisms, including board leadership, board independence, institutional ownership, analyst following, and anti- takeover provisions, after controlling for various firm characteristics. After correcting for endogeneity and simultaneity issues, the results show that (...) CSR engagement positively influences firm value measured by industry-adjusted Tobin’s q. We find that the impact of analyst following for firms that engage in CSR on firm value is strongly positive, while the board leadership, board independence, blockholders’ ownership, and institutional ownership play a relatively weaker role in enhancing firm value. Furthermore, we find that CSR activities that address internal social enhancement within the firm, such as employees diversity, firm relationship with its employees, and product quality, enhance the value of firm more than other CSR subcategories for broader external social enhancement such as community relation and environmental concerns. (shrink)

This study examines whether reputable analysts and brokerage houses as thinker-driven middlemen led corporations to engage in CSR by investigating the causal relation between CSR and analysts and brokerage houses’ reputations. While theory of information asymmetry predicts that corporations with higher level of CSR tend to attract more reputable analysts and brokerage houses such that they can disseminate valuable information to outside investors, the social pressure theory expects corporations, which receive coverage from more reputable analysts and brokerage houses, tend to (...) have higher CSR. Our findings suggest that CSR activities per se do not attract experienced analysts and reputable brokerage houses. Instead, we find that corporations which are covered by more experienced analysts and reputable brokerage houses tend to increase their CSR activities, indirectly supporting the social pressure hypothesis based on thinker-led-doer model. In addition, we find that corporations tend to have higher CSR strengths, lower CSR concerns, and increased CSR components of diversity and product when they are covered by more reputable analysts and brokerage houses. We interpret these findings are supportive of the social pressure hypothesis, rather than the information asymmetry hypothesis. (shrink)

This study examines the impact of board diversity on firms’ corporate social responsibility performance. Using seven different measures of board diversity across 1,489 U.S. firms from 1999 to 2011, the study finds that board diversity is positively associated with CSR performance. Board diversity is associated with a greater number of areas in which CSR is strong and a fewer number of areas in which CSR is a concern. These findings support the stakeholder theory and are consistent with the view that (...) board diversity enhances firms’ ability to satisfy the needs of their broader groups of stakeholders. We find that gender, tenure, and expertise diversities seem to be the driving factors of firms’ CSR activities. Furthermore, we find that board diversity significantly increases CSR performance by increasing CSR strengths and reducing CSR concerns for firms producing consumer-oriented products and firms operating in more competitive industries. Our results remain robust using different measures of CSR performance, different estimation methods, and different samples. (shrink)

We hypothesize that CSR serves as a control mechanism to reduce deviations from optimal risk taking, and therefore, CSR curbs excessive risk taking and reduces excessive risk avoidance. Based on the stakeholder theory, firms with CSR focus must balance the interests of multiple stakeholders, and therefore, managers must allocate resources to satisfy both investing and non-investing stakeholders’ interests. Using five measures of corporate risk taking and a sample of 1718 US firms during 1998 to 2011, we find that stronger CSR (...) performance is associated with smaller deviations from optimal risk taking levels. We examine the mechanism through which CSR has an impact on firm value and find a positive indirect impact of CSR on firm value through the impact of CSR on risk taking. CSR performance is positively associated with firm value because CSR reduces excessive risk taking and risk avoidance. (shrink)

Organizational theory argues that institutional social responsibility, which represents managers’ moral values, ethics, and norms, and technical social responsibility, which represents firms’ relationship with key stakeholders, influence corporate ethical behavior. We examine and compare the impacts of strengths and concerns of institutional and technical social responsibilities on the likelihood of corporate fraud. Using a sample of 152 high-profile corporate fraud cases in the U.S. during the 2000-2010 period, we find that firms’ corporate social responsibility activities reduce the likelihood of corporate (...) fraud. More importantly, our study finds that both institutional strengths and technical strengths reduce the likelihood of corporate fraud. Institutional concerns also increase the likelihood of corporate fraud and institutional responsibility plays a more significant role than technical responsibility. Our study supports the legitimacy theory of social responsibility and highlights the importance of moral management to reduce the likelihood of corporate fraud. (shrink)

In this paper, we examine the relation between corporate social responsibility (CSR) and firm risk in controversial industry sectors. We develop and test two competing hypotheses of risk reduction and window dressing. Employing an extensive U.S. sample during the 1991-2010 period from controversial industry firms, such as alcohol, tobacco, gambling, and others, we find that CSR engagement inversely affects firm risk after controlling for various firm characteristics. To deal with endogeneity issue, we adopt a system equation approach and difference regressions (...) and continue to find that CSR engagement of firms in controversial industry sectors negatively affects firm risk. To examine the premise that firm risk is more of an issue for controversial firms, we further examine the difference between non-controversial and controversial firm samples, and find that the effect of risk reduction through CSR engagement is more economically and statistically significant in controversial industry firms than in non-controversial industry firms. These findings support the risk-reduction hypothesis, but not the window-dressing hypothesis, and the notion that the top management of U.S. firms in controversial industries is, in general, risk averse and that their CSR engagement helps their risk management efforts. (shrink)

A growing group of institutional investors use divestment strategically to deter misconducts that are harmful for the climate and society. Based on Kantian ethics, we propose that divestment represents investors’ universal and absolute moral commitment to socially responsible investing (SRI). Following categorical and hypothetical imperatives and reciprocity as a norm, we hypothesize how institutional investors’ commit to SRI through a divestment strategy against ethically reprehensible behaviour of banks, especially when these investors represent banks themselves. Using a hand-collected database of the (...) revelation dates of enforcement actions on banks, we find evidence that banks are less likely to divest equity holding on banks with misconduct (fined banks) than their non-bank institutional investors peers. Banks that commit to invest responsibly by signing for the Principles for Responsible Investment (PRI) are not significantly more likely to divest on fined banks stocks than non-signatory banks. Moreover, divestment of fined banks whose own legitimacy to operate is in question is not significantly different from non-fined banks divestment. We find that European banks are more inclined to sell their holdings permanently on fined banks than their United States peers. Therefore, bank’s moral commitment to SRI via divestments is influenced more by cultural and reciprocity norms than their moral commitment to participate in the PRI. (shrink)

In this article, we examine the association between ethics and disclosure and the impact of this association on the long-term, post-issue performance of seasoned equity offerings (SEOs). We argue that firms with extensive disclosure are less likely to face information problems, and more likely to lead to an active shareholder monitoring, and therefore, engage in fewer unethical activities, such as aggressive earnings manipulation, and have better long-term, post-issue performance. Consistent with these predictions, this study presents evidence that disclosure is negatively (...) related to unethical earnings manipulation and positively associated with long-term, post-issue performance. In particular, we find that long-term, post-issue SEO underperformance is significantly less for firms with extensive disclosure and conservative earnings management than firms with less disclosure and aggressive earnings management. We interpret this evidence to mean that over the long run, the capital market values ethical financial reporting and corporate efforts to incorporate social responsibility into their decision-making processes, for example, by enhancing information transparency through voluntary disclosure. (shrink)

In this study, we examine whether corporate environmental responsibility plays a role in enhancing operating performance in the financial services sector. Because achieving success with CER investing is often a long-term process, we maintain that by effectively investing in CER, executives can decrease their firms’ environmental costs, thereby enhancing operating performance. By employing a unique environmental dataset covering 29 countries, we find that the reducing of environmental costs takes at least 1 or 2 years before enhancing return on assets. We (...) also find that reducing environmental costs has a more immediate and substantial effect on the performance of financial services firms in well-developed financial markets than in less-developed financial markets. These results are economically and statistically significant and robust even after alleviating endogeneity and using an additional performance measure. We interpret our empirical results as supporting the social impact and reputation-building hypothesis. Our findings also suggest that policy makers dealing with corporate sustainability management should pursue an environment-centered industry policy not only at the manufacturing sector but also at the financial services sector, as firms in both sectors with lower environmental costs perform better. (shrink)

This paper studies the relationship between personal stock donation by top executives and board of directors (insiders) of publicly traded corporations and their personal tax, shareholders' returns, and social responsibility. The study finds evidence that the timing of stock donations is driven by personal tax gain. The study further shows, comparing stock gift corporations relative to their non-stock gift cohorts, that personal stock gifts are associated with lower short-term and long-term stock returns to shareholders. This implies that stock donation driven (...) by insiders' personal gain adversely affects shareholder wealth. However, the likelihood and intensity of insiders to make personal stock donation is reduced when firms have strong corporate social responsibility (CSR). Agency theory explains insiders' opportunistic behavior, stakeholder theory is also supported by evidence that stock donation is negatively related to CSR, and stewardship theory offers a different view to explain the rationale behind insiders' stock donation and shareholders' reactions to stock gifts. (shrink)

This paper studies the relationship between personal stock donation by top executives and board of directors (insiders) of publicly traded corporations and their personal tax, shareholders' returns, and social responsibility. The study finds evidence that the timing of stock donations is driven by personal tax gain. The study further shows, comparing stock gift corporations relative to their non‐stock gift cohorts, that personal stock gifts are associated with lower short‐term and long‐term stock returns to shareholders. This implies that stock donation driven (...) by insiders' personal gain adversely affects shareholder wealth. However, the likelihood and intensity of insiders to make personal stock donation is reduced when firms have strong corporate social responsibility (CSR). Agency theory explains insiders' opportunistic behavior, stakeholder theory is also supported by evidence that stock donation is negatively related to CSR, and stewardship theory offers a different view to explain the rationale behind insiders' stock donation and shareholders' reactions to stock gifts. (shrink)

Business Ethics, the Environment &Responsibility, Volume 32, Issue 4, Page 1452-1469, October 2023.

In this article, we examine the empirical association between firm value and CSR engagement for firms in sinful industries, such as tobacco, gambling, and alcohol, as well as industries involved with emerging environmental, social, or ethical issues, i.e., weapon, oil, cement, and biotech. We develop and test three hypotheses, the window-dressing hypothesis, the value-enhancement hypothesis, and the value-irrelevance hypothesis. Using an extesive US sample from 1995 to 2009, we find that CSR engagement of firms in controversial industries positively affects firm (...) value after controlling for various firm characteristics. To address the potential endogeneity problem, we further estimate a system of equations and change regression and continue to find a positive relation between CSR engagement and firm value. Our findings support the value-enhancement hypothesis and are consistent with the premise that the top management of US firms in controversial industries, in general, considers social responsibility important even though their products are harmful to human being, society, or environment. (shrink)

We empirically examine the impact of corporate social responsibility (CSR) on CEO compensation using a large sample of the US firms from 1996 to 2010. We develop and test two hypotheses, the overinvestment hypothesis based on agency theory and the conflict–resolution hypothesis based on stakeholder theory. We find that the lag of CSR adversely affects both total compensation and cash compensation, after controlling for various firm and board characteristics. Our estimates show that an interquartile increase in CSR is followed by (...) a 4.35% (2.78%) decrease in total (cash) compensation. We also find an inverse association between lagged employee relations and CEO compensation. Our results are robust to the correction for endogeneity using instrumental variable approach. Taken together, our results support the conflict–resolution hypothesis, but not the CSR overinvestment argument. (shrink)

In this study, we examine the relation between corporate environmental responsibility and risk in U.S. public firms. We develop and test the risk-reduction, resource-constraint, and cross-industry variation hypotheses. Using an extensive U.S. sample during the 1991–2012 period, we find that for U.S. industries as a whole, CER engagement inversely affects firm risk after controlling for various firm characteristics. The result remains robust when we use firm fixed effect or an alternative measure of CER using principal component analysis or downside risk (...) measures. To address the concern of endogeneity bias, we use a system equations approach and dynamic system generalized methods of moment regressions, and continue to find that environmentally responsible firms experience lower risk. These findings support the risk-reduction hypothesis, but not the resource-constraint hypothesis, along with the notion that the top management in U.S. firms is generally risk averse and that their CER engagement facilitates their risk management efforts. Our cross-industry analysis further reveals that the inverse CER-risk association mainly comes from the manufacturing sector, whereas in the service sector, CER tends to increase firm risk. (shrink)

In this study, we examine the empirical association between corporate social responsibility and information asymmetry by investigating their simultaneous and endogenous effects. Employing an extensive U.S. sample, we find an inverse association between CSR engagement and the proxies of information asymmetry after controlling for various firm characteristics. The results hold using 2SLS considering the reverse side of information asymmetry influencing CSR activities. The results also hold after mitigating endogeneity based on the dynamic panel system generalized method of moment. Furthermore, the (...) CSR–information asymmetry relation is amplified in high-risk firms due to managers’ efforts to build a good reputation. Last, we find that CSR engagement is inversely associated with reputational risk measure and lower predicted value of reputational risk is positively associated with lower information asymmetry measures. We interpret these results as supporting the stakeholder theory-based, reputation-building explanation that considers CSR engagement as a vehicle to build and maintain firm reputation thereby enhancing the information environment. (shrink)

In this article, we propose that giving in cash and non-cash differ in their relation with the giving firm’s future corporate financial performance and only cash giving is associated with future CFP. Using a novel dataset from ASSET4 that differentiates corporate giving over a sample period of 2002–2012, we examine three competing hypotheses: agency cost hypothesis that cash giving reflects agency cost and destroys value for shareholders, investment hypothesis that cash giving is an investment by management that aims for better (...) future return, and information hypothesis that cash giving has informational value to shareholders as cash is a critical resource at a firm and giving is a decision by managers who are insiders. We find that indeed, only cash giving is positively associated with future CFP and firm value, measured by Fama–French five-factor abnormal risk-adjusted stock returns, future return on assets, and Tobin’s Q. In addition, we find that the positive association exists only between excess, i.e., unexpected, but not expected cash giving and future CFP. Our empirical findings support the information hypothesis, but neither the agency hypothesis nor the investment hypothesis, and are robust to a number of endogeneity tests, including orthogonalized cash giving, instrumental variable regression using geography-based instruments, and propensity score matching. Furthermore, we show that the positive association between future CFP and unexpected cash giving is only pronounced at firms with good governance and relatively higher sales growth where agency problems are less likely, and at firms with no alternative mechanisms to demonstrate the strength of cash flow. Additionally, we do not find evidence that suggests in-kind giving to possess any informational value. (shrink)

The issue of management’s relations to the environment has received a significant amount of attention in the literature on corporate social responsibility. Yet the influence of religion on managers’ environmental decisions has until now remained unexamined despite its known importance. In this article, we examine the empirical association between religion—primarily Christianity—and the environmental practices a firm’s management undertakes by investigating their OLS, principal component, simultaneous, and endogenous effects. Employing a large and extensive U.S. sample, we find a negative association between (...) the environmental practices initiated by a firm’s managers and the religiosity of the surrounding community, after controlling for various firm and demographic characteristics. In addition, after mitigating endogeneity with the dynamic system generalized method of moment, we still find an inverse association between religiosity and environmental-friendly decisions of management. We interpret these results as providing some support for the “dominion hypothesis” that claims Christian beliefs discourage environmental concern, but not for the “stewardship hypothesis” that implies that Christianity encourages people to “exercise a responsible stewardship over nature.” Nevertheless, additional analysis shows Christian groups differ significantly in how each influences managers’ environmental decisions. (shrink)

ABSTRACT:We examine whether religion influences company decisions related to corporate community involvement. Employing a large US sample, we show that the CCI initiatives of a company are positively associated with the level of Christian religiosity present in the region within which that company’s headquarters is located. This association persists even after we control for a wide range of firm characteristics and after we subject our results to several econometric tests. These results support our religious morality hypothesis which holds that companies (...) headquartered in regions with higher levels of Christian religiosity will engage in more CCI initiatives. We also find that while Catholic and mainline Protestant religiosity have a positive influence on firms’ CCI initiatives, evangelical Protestant religiosity does not. This supports our differentiated responses hypothesis which holds that institutional differences among religious groups will produce different effects on companies’ CCI. This hypothesis is based on institutional theory. (shrink)

The World Bank recently noted: “Social license to operate has traditionally referred to the conduct of firms with regard to the impact on local communities and the environment, but the definition has expanded in recent years to include issues related to worker and human rights”. In this paper, we examine a factor that can influence the kind of work conditions that can facilitate or obstruct a firm’s attempts to achieve the social license to operate. Specifically, we examine the empirical association (...) between a company’s employee practices and the religiosity of its local community by investigating their fixed and endogenous effects. Using a large and extensive U.S. sample, we find a positive association between the “employee friendly” practices of a firm and the religiosity of the local community after controlling for several firm characteristics. In addition, after mitigating endogeneity with the dynamic panel system generalized method of moment and after employing several other econometric tests, we still find a robust positive association between the religiosity of the local community and employee-friendly practices. Since recent research has shown that the firm’s treatment of its stakeholders is a key to achieving an SLO, and since employees constitute a highly significant stakeholder group, we interpret our results as supporting the view that religion is an important influence on the kinds of employee practices that can increase the likelihood that a firm will acquire the SLO. (shrink)

Workforce diversity has received increasing amounts of attention from academics and practitioners alike. In this article, we examine the empirical association between a firm’s workforce diversity and the degree of religiosity of the firm’s management by investigating their unidirectional and endogenous effects. Employing a large and extensive U.S. sample of firms from the years 1991–2010, we find a positive association between a measure of the firm’s commitment to diversity and the religiosity of the firm’s management after controlling for various firm (...) characteristics. In addition, after controlling for endogeneity with the dynamic panel generalized method of moment, we still find a positive association between the firm’s diversity and management’s religiosity. We interpret these results as supportive of the religious motivation explanation that views the firm as a human community and considers religion as a factor that influences managers to more positively embrace diversity. Our results, however, provide no support for the resource-constraint hypothesis that views the firm as a nexus of contracts and sees managers as aiming to maximize shareholder returns under resource constraints that force them to invest only in projects that have a positive net present value and reject diversity initiatives since these do not have a positive NPV. (shrink)

Political insider trading has brought substantial attention to ethical considerations in the academic literature. While the Stop Trading on Congressional Knowledge (STOCK) Act prohibits members of Congress and their staff from leveraging non-public information to make investment decisions, political insider trading still prevails. We discuss political ethics and social contract theory to re-engage the debate on whether political insider trading is _unethical_ and raises the issues of conflict of interest and social distrust. Empirically, using a novel measure of information risk, (...) we find that senator trades are associated with substantially high levels of information asymmetry. Moreover, based on inside political information, senators earn significant market-adjusted returns (4.9% over 3 months). Thus, our results do not support the prediction made by social contract theory and thereby provide a potential resolution to the ongoing debate on banning stock trading for members of Congress. (shrink)

This study examines the influence of Christian religion on corporate decisions related to human rights in the United States. Specifically, it examines the empirical association between a company's human rights practices and the Christian religiosity in its local community, as well as individual CEO religiosity in the United States, both of which have not been tested in prior studies. Employing a large sample from the United States, we find a congruent association between the “human rights friendly” practices of a company (...) and the Christian religiosity of the local community. This novel finding is robust to a diverse set of tests. In addition, we find that the association between Christian religiosity in the United States and human rights is more significant in reducing human rights concerns, than it improves human rights strengths. This study interprets these results as upholding the religious morality hypothesis, namely, that companies located in areas with higher religiosity are likely to engage in more human rights-friendly practices, and the United States. Christians consider religion as an influencing factor that encourages managers to embrace human rights. Furthermore, this study finds that individual religious managers tend toward more human rights-friendly practices, supporting our religious manager hypothesis. (shrink)

There is a growing literature on corporate social responsibility, but few have focused on the implications of business groups for CSR. We examine the antecedents and outcomes of CSR behaviors of group firms in Korea. We find that group affiliation is associated with higher CSR overall and for its major societal and environmental components. However, the ownership disparity between cash flow and control by controlling inside shareholders is associated with lower CSR, consistent with opportunistic rent expropriation theory. We further find (...) that CSR initiatives can impact group firms positively in the event of bad events, consistent with insurance theory. This motive for CSR as a means of enhancing reputation capital to buffer the bad events is pronounced for group firms because of group-wide dissemination of negative reputational externality. (shrink)

This study examines the impact of corporate social responsibility activities on insider trading. While opponents of insider trading claim that the buying or selling of a security by insiders who have access to non-public information is illegal, proponents argue that insider trading improves economic efficiency and fairness when corporate insiders buy and sell stock in their own companies. Based on extensive U.S. data of insider trading and CSR engagement, we find that both the number of insider transactions and the volume (...) of insider trading are positively associated with CSR activities.We also find that legal insider transactions are positively related to CSR engagement even after controlling for potential endogeneitybias and various firm characteristics. Furthermore, our evidence suggests that firms perceive adjustment to CSR dimension of product as being efficient, while adjustment to diversity and environmental CSR as being inefficient. Our results of bad and illegal insider trading proxies are consistent with the interpretation that firms with high CSR ratings do not attempt to engage in unethical or bad insider trading in a significant fashion. Combined together, we consider our empirical evidence supportive of the fairness and efficiency explanation, but not the unfairness and inefficiency hypothesis. (shrink)

A nossa situação atual, em termos de fé cristã, é muito semelhante à do cego de nascença de que nos fala o evangelho (Jo 9,1-41). A experiência de vinte séculos de cristianismo não impede que Jesus mesmo nos dirija também esta pergunta: “Crês no Filho do Homem?” (Jo 9,35). A questão é saber se teríamos a simplicidade do cego para responder: “Quem é ele, Senhor, para que eu creia?” (Jo 9,36). Porque equivaleria a reconhecer que o conhecemos sem conhecê-lo. E (...) só quando aceitamos isso, pode recomeçar o processo de crer. A situação atual do cristianismo repercute no modo de crer e o condiciona. Não podemos continuar a crer por inércia. Aderir à pessoa de Jesus Cristo deixou de ser algo “evidente”. Não só para as novas gerações ou para os que julgam a fé cristã incompatível com o mundo moderno. Também para nós. Queiramos ou não, somos afetados por essa situação de desamparo. E o problema não é só de linguagem . Trata-se de uma experiência , a experiência de uma vida desconcertante mas fascinante, humana como a nossa mas “diferente”. Podem ainda as mesmas e velhas palavras da fé desencadear em nós a experiência que aqueles primeiros seguidores – homens e mulheres – fizeram diante da existência concreta de Jesus de Nazaré? Aderir a essa vida com a mesma significação que tinha para os primeiros cristãos: isso seria crer em Jesus Cristo hoje. Mas para isso teríamos que sentir o mesmo desamparo do cego de nascença: “Quem é ele, Senhor, para que eu possa crer”? O nosso perigo é sabermos demais. Por isso, para podermos recuperar a “diferença” cristã no que ela tem de verdadeiramente original é necessário aceitar que sejam questionadas as nossas “evidências” e reconhecer que a nossa figura de Jesus foi muitas vezes deformada. (shrink)

English summary: According to a current prejudice, the God of reason does not have a home in Protestantism. On the basis of model studies on the connection between biblical, Platonic and Aristotelian themes in the development of the Christian concept of God in late antiquity, the Middle Ages and the Renaissance, the authors of this volume show that the reformers did not at all flatly dismiss the rationality of faith. The articles focus on the modern transformations of the concept of (...) God in the 18th and 19th centuries. The volume, a collection of case studies of the history of the problem of the Christian concept of God, concludes with prominent syntheses of revelation and reason in the 20th century. German description: Einem gangigen Vorurteil zufolge hat der Gott der Vernunft im Protestantismus keine Heimat. Nach exemplarischen Studien zur Verbindung von biblischen mit platonischen und aristotelischen Motiven bei der Entfaltung des christlichen Gottesgedankens in Spatantike, Mittelalter und Renaissance zeigt der vorliegende Band aber, dass die Reformatoren der Vernunft des Glaubens keineswegs pauschal den Abschied gaben. Der Schwerpunkt der Beitrage liegt auf den neuzeitlichen Transformationen des Gottesgedankens im 18. und 19. Jh. Prominente Synthesen von Offenbarung und Vernunft im 20. Jh. schliessen den Band ab, der Fallstudien zu einer Problemgeschichte des christlichen Gottes-Denkens versammelt. Mit Beitragen von: Martin Arneth, Christine Axt-Piscalar, Ulrich Barth, Markus Buntfuss, Jorg Dierken, Douglas Hedley, Thomas Kaufmann, Dietrich Klein, Dietrich Korsch, Martin Laube, Jorg Lauster, Friederike Nussel, Bernd Oberdorfer, Joachim Ringleben, Friedemann Voigt, Dorothea Wendebourg, Gunther Wenz. (shrink)

Psychiatric diagnoses such as Autism Spectrum Disorder (ASD) are primarily attributed on the basis of behavioral criteria. The aim of most of the biomedical research on ASD is to uncover the underlying mechanisms that lead to or even cause pathological behavior. However, in the philosophical and sociological literature, it has been suggested that autism is also to some extent a ‘social construct’ that cannot merely be reduced to its biological explanation. We show that a one-sided adherence to either a biological (...) or a social explanation leads to a moral dilemma, a Catch-22, for autistics and for those living with them. Such explanations close the space for self-identifying as autistic and at the same time being considered to be in good mental health. They foreclose the possibility of making sense of the lived experience of (and with) autistics. In this paper we argue that such lack of space for moral imagination inherently leads to scientific stalemate. We propose that one can only go beyond this stalemate by taking an ethical stance in theorizing, one that enables better intersubjective understanding. Only on such a view can behavior and biology be linked without either disconnecting them or reducing the one to the other. (shrink)

The aim of this article is to analyse the relation between the second law of thermodynamics and the so-called arrow of time. For this purpose, a number of different aspects in this arrow of time are distinguished, in particular those of time-reversal (non-)invariance and of (ir)reversibility. Next I review versions of the second law in the work of Carnot, Clausius, Kelvin, Planck, Gibbs, Caratheodory and Lieb and Yngvason, and investigate their connection with these aspects of the arrow of time. It (...) is shown that this connection varies a great deal along with these formulations of the second law. According to the famous formulation by Planck, the second law expresses the irreversibility of natural processes. But in many other formulations irreversibility or even time-reversal non-invariance plays no role. I therefore argue for the view that the second law has nothing to do with the arrow of time. (shrink)

The target article by Locke & Bogin (L&B) focuses on the evolution of language as a communicative tool. They neglect, however, that from infancy onwards humans have the ability to go beyond successful behaviour and to reflect upon language (and other domains of knowledge) as a problem space in its own right. This ability is not found in other species and may well be what makes humans unique.

In the scholium to proposition 49 of Part 2 of the Ethics, Spinoza addresses a number of prejudices that tend to obscure the essentially judgmental nature of ideas. One warning is issued against those who do not distinguish accurately between ideas and images, and, for this exact reason, fail to see that every idea, insofar as it is an idea, always involves an affirmation that something is the case. This paper shows that in order to properly understand Spinoza's remarks in (...) this passage, we must redirect attention to Descartes’ Meditations on First Philosophy, and more particularly to the objections raised against them by Hobbes. Specifically, I argue for the identification of Hobbes and other likeminded “imagists” as Spinoza's main targets, and not, as is often assumed, Descartes himself or Cartesians in general. My identification not only resolves interpretative confusion surrounding this passage, but it also confirms Spinoza's commitment to a key rationalist assumption: the existence of a mind that can grasp or exhibit natures by clear and distinct perceptions. While both adequate and inadequate ideas are necessitated beliefs or judgments in which we assent to something, virtue consists in being propelled by the intellect. (shrink)

Roughly speaking, classical statistical physics is the branch of theoretical physics that aims to account for the thermal behaviour of macroscopic bodies in terms of a classical mechanical model of their microscopic constituents, with the help of probabilistic assumptions. In the last century and a half, a fair number of approaches have been developed to meet this aim. This study of their foundations assesses their coherence and analyzes the motivations for their basic assumptions, and the interpretations of their central concepts. (...) The most outstanding foundational problems are the explanation of time-asymmetry in thermal behaviour, the relative autonomy of thermal phenomena from their microscopic underpinning, and the meaning of probability. A more or less historic survey is given of the work of Maxwell, Boltzmann and Gibbs in statistical physics, and the problems and objections to which their work gave rise. Next, we review some modern approaches to (i) equilibrium statistical mechanics, such as ergodic theory and the theory of the thermodynamic limit; and to (ii) non-equilibrium statistical mechanics as provided by Lanford's work on the Boltzmann equation, the so-called Bogolyubov-Born-Green-Kirkwood-Yvon approach, and stochastic approaches such as `coarse-graining' and the `open systems' approach. In all cases, we focus on the subtle interplay between probabilistic assumptions, dynamical assumptions, initial conditions and other ingredients used in these approaches. (shrink)