Corporate social responsibility and credit rating: evidence from French companies

IF 3.6 Q1 BUSINESS, FINANCE
Sourour Ben Saad, Mhamed Laouiti, Aymen Ajina
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引用次数: 0

Abstract

Purpose

This study aims to provide further insights into the connection between corporate social responsibility (CSR) and companies’ credit ratings, while also exploring the role of corporate governance as a moderating factor. The hypotheses for this relationship are rooted in both legitimacy and stakeholder theories.

Design/methodology/approach

Using a sample of French non-financial listed firms from 2007 to 2020, this paper uses the ordered probit model introduced by Greene (2000). The issue of endogeneity has also been addressed.

Findings

The study reveals that CSR practices positively impact companies’ credit ratings by enhancing solvency and financial performance. Specifically, firms that prioritize CSR, particularly in the social and environmental dimensions (such as community relations, diversity, employee relations, environmental performance and product characteristics), tend to have higher credit ratings and a reduced risk of default. This suggests that credit rating agencies likely incorporate CSR performance when assigning credit ratings. Furthermore, the quality of corporate governance acts as a moderator, strengthening the relationship between CSR and credit ratings. The findings remain robust even after accounting for key firm attributes and addressing potential endogeneity between CSR and credit ratings.

Practical implications

This research provides valuable guidance for policymakers, corporate managers, investors and other stakeholders, as it offers insights into the influence of CSR activities on risk premiums and financing costs. For financial institutions, expanding credit decisions to encompass non-financial factors such as CSR can result in more accurate predictions of firm credit quality compared to relying solely on financial indicators.

Originality/value

To the best of the authors’ knowledge, this study stands out as the first to systematically examine the relationship between CSR and credit ratings within the French context. Moreover, it distinguishes itself by investigating the moderating influence of corporate governance on this relationship, setting it apart from prior research.

企业社会责任与信用评级:来自法国公司的证据
本研究旨在进一步深入探讨企业社会责任(CSR)与公司信用评级之间的关系,同时探讨公司治理作为调节因素的作用。本文以 2007 年至 2020 年法国非金融类上市公司为样本,采用 Greene(2000 年)提出的有序 probit 模型,对这一关系进行了假设。研究结果研究结果表明,企业社会责任实践通过提高偿付能力和财务业绩,对公司的信用评级产生积极影响。具体而言,优先考虑企业社会责任的公司,尤其是在社会和环境方面(如社区关系、多样性、员工关系、环境绩效和产品特性),往往会获得更高的信用评级并降低违约风险。这表明,信用评级机构在进行信用评级时,很可能会将企业社会责任表现纳入其中。此外,公司治理质量也起到了调节作用,加强了企业社会责任与信用评级之间的关系。即使考虑了企业的关键属性,并解决了企业社会责任与信用评级之间潜在的内生性问题,研究结果仍然是稳健的。 这项研究为政策制定者、企业管理者、投资者和其他利益相关者提供了有价值的指导,因为它深入揭示了企业社会责任活动对风险溢价和融资成本的影响。对于金融机构来说,将企业社会责任等非财务因素纳入信贷决策,可以比单纯依赖财务指标更准确地预测企业信用质量。 原创性/价值 据作者所知,本研究是第一项在法国范围内系统研究企业社会责任与信用评级之间关系的研究。此外,本研究还调查了公司治理对这一关系的调节作用,使其有别于以往的研究。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
4.30
自引率
0.00%
发文量
18
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