Choosing To Be "Good": How Managers Determine Their Impact on Financial and Social Performance
Citation
Hong, Bryan, and Dylan Minor. Choosing To Be "Good": How Managers Determine Their Impact on Financial and Social Performance. Harvard Business School Working Paper, No. 16-011, July 2015.Abstract
We investigate the relationship between a manager’s influence on firm financial and social performance. To examine the mechanism governing the relationship between a manager’s investment decisions along both dimensions of performance, we use a formal agency theory model to develop testable implications. In our empirical results, we find that a manager’s influence on firm CSR activities is negatively related to their influence on financial performance. Also, as suggested by the implications of the model, we find that managers who operate in industries with more volatile financial performance and receive a lower share of compensation from incentive-based pay are more likely to have a positive influence on firm social performance.Terms of Use
This article is made available under the terms and conditions applicable to Other Posted Material, as set forth at http://nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-of-use#LAACitable link to this page
http://nrs.harvard.edu/urn-3:HUL.InstRepos:17779601
Collections
- HBS Scholarly Articles [853]
Contact administrator regarding this item (to report mistakes or request changes)