Journal of Business Ethics

, Volume 114, Issue 4, pp 625–631

Corporate Social Performance, Firm Valuation, and Industrial Difference: Evidence from Hong Kong

  • Yan-Leung Cheung
  • Kun Jiang
  • Billy S. C. Mak
  • Weiqiang Tan
Article

DOI: 10.1007/s10551-013-1708-0

Cite this article as:
Cheung, YL., Jiang, K., Mak, B.S.C. et al. J Bus Ethics (2013) 114: 625. doi:10.1007/s10551-013-1708-0

Abstract

This study addresses two issues. First, does corporate social performance matter in Hong Kong. Second, if yes, is it relevant to some industries more than others. To answer these questions, we develop a corporate social performance index (CSP) to measure the quality of corporate social performance of major Hong Kong listed firms. The criteria are based on the OECD Principles of Corporate Governance. Using the 3-year period from 2002 to 2005, we find that firm valuation is positive and significantly associated with CSP. Interestingly, this relation matters less in China related firms and firms with a concentrated ownership structure. The results also show that CSP impacts firm valuation more positively when the firm is in the service sector. We further find that CSP is positively related to the market valuation of the subsequent year.

Keywords

Hong Kong market Corporate social performance Firm valuation 

Copyright information

© Springer Science+Business Media Dordrecht 2013

Authors and Affiliations

  • Yan-Leung Cheung
    • 1
  • Kun Jiang
    • 2
  • Billy S. C. Mak
    • 3
  • Weiqiang Tan
    • 3
  1. 1.The Hong Kong Institute of EducationHong Kong SARPeople’s Republic of China
  2. 2.School of Economics and Finance The University of Hong KongHong Kong SARPeople’s Republic of China
  3. 3.School of BusinessHong Kong Baptist UniversityHong Kong SARPeople’s Republic of China

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