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Abstract
Proponents of corporate environmental responsibility argue that corporations shortchange shareholders by investing too little
in environmental responsibility. They claim that corporations can improve their financial performance by increasing their
investment in environmental responsibility. Opponents of corporate social responsibility argue that corporations shortchange
shareholders by investing too much in environmental responsibility. They claim that corporations can improve their financial
performance by reducing their investment in environmental responsibility. Yet, others claim that corporations serve their
shareholders well by investing just enough in social responsibility, not too little and not too much. If so, corporations
increase their investment in environmental responsibility when an increase improves financial performance and reduce their
investment in environmental responsibility when a decrease improves financial performance. Our evidence is consistent with
this last claim. We find that the behavior of corporations is consistent with the claim that they act in the interest of shareholders,
increasing or decreasing their investment in environmental responsibility as necessary to improve their financial performance.
- Content Type Journal Article
- Pages 1-15
- DOI 10.1007/s10551-011-0954-2
- Authors
- Yongtae Kim, Leavey School of Business, Santa Clara University, 500 El Camino Real, Santa Clara, CA 95053-0388, USA
- Meir Statman, Leavey School of Business, Santa Clara University, 500 El Camino Real, Santa Clara, CA 95053-0388, USA
- Journal Journal of Business Ethics
- Online ISSN 1573-0697
- Print ISSN 0167-4544