Earticle

초록

영어

The primary goal of business entities has shifted from profit-orientation toward broader socially motivated perspectives over the recent years. In the past, due to the over-emphasis on the short-term profits, business community frequently had to confront criticisms and protests raised by society at large. Today’s corporations are well aware of the importance of keeping balance between social responsibility and the pursuit of financial goals to ensure their long-lasting survival and prosperity. As such, business organizations make efforts to enhance their corporate image as a way to improve long-term profitability. With the heightened recognition of corporate social responsibility (CSR) in society, corporate entities have continuously refined their strategies to meet diverse stakeholders’ demands. In accordance with these circumstances, extensive research efforts have been undertaken to assess the empirical association between CSR and corporate financial performance (CFP) under diverse geographical context. However, rarely has it focussed on the association between CSR and CEO and CEO’s power, even though the final decision maker for CSR is the CEO. To fill void, this study examines the empirical relation between CSR and CEO power in Korean context. Based on agency theory, Barnea and Rubin(2010) suggests that powerful CEOs have an interest in over-investing in CSR in order to obtain private benefits of building reputation, possibly at a cost to shareholders. On the other hands, the conflicts resolution view asserts that powerful CEOs engage in the optimal level of CSR that lead to improve firm value through resolving the conflicts among various stakeholders. While those two views are predicting contradictory impact of CEO power on CSR, empirical research examining the association between CEO power and CSR in Korean context does not exist, to our knowledge. As such, this study is the first that provides Korean evidence on the relationship between CEO power and CSR. To achieve the above research objective, we examine whether the CSR performance is systematically related with the proxy of CEO power using a ordered probit regression model. In addition, we verify how the CSR performance with CEO power impact upon firm value using OLS and 2SLS. We assess CSR performance using ESG grade developed by KCGS(Korea Corporate Governance Service). CEO power is developed using CEO pay slice suggested by Bebchuk et al.(2011). Our sample is drawn from companies listed on the KRX for which the information of executive compensation and ESG grade are available. Our sample period covers 4 years from 2013-2016 and the final sample includes 621 firm-years from both manufacturing and non-manufacturing industries. Our main findings are as follows. First, we find a negative and significant relationship between CEO power and CSR. Second, we find that the interactive terms of CPS×CSR is positively correlated with firm value measured by Tobin’s Q. These results imply that powerful CEOs engage in the optimal level of CSR that lead to improve firm value. In other words, our results show that powerful CEO restricts over-investing in CSR that do not contribute to increasing firm value and involve only additional expenditure in Korean context. Major contribution of this study is one of the pioneering researches aiming at providing Korean evidence investigating the empirical association between CEO power and CSR performance. And second contribution derives from the improvement of research design over many previous studies. In particular, we incorporate recent innovations in measuring corporate governance system into our research design by using CEO pay slice as an empirical proxy of CEO centrality. In addition, we conducted additional analysis of the relation between interaction terms and firm value after controlling for potential endogeneity by using two-stage least squares regression analysis based on the simultaneous equation approach.

목차

Ⅰ. 서론
Ⅱ. 선행연구 및 가설설정
Ⅲ. 연구설계
Ⅳ. 실증분석결과
Ⅴ. 결론
참고문헌
Abstract

키워드

저자

• 신성욱 [ Sung-Wook Shin | 부산가톨릭대학교 경영학과 ] 제1저자
• 곽영민 [ Young Min Kwak | 울산대학교 경영대학 회계학과 ] 교신저자

참고문헌

발행기관

간행물

표지보기 관심저널 등록

• 간행물명

  생산성연구: 국제융합학술지 [Productivity Research: An International Interdisciplinary Journal]

• 간기

  격월간

• pISSN

  1225-3553

• 수록기간

  1987~2025

• 등재여부

  KCI 등재

• 십진분류

  KDC 325 DDC 330