Corporate social responsibility and tax avoidance

Study on Corporate Social Responsibility (CSR): Focus on Tax Avoidance and Financial Ratio Analysis

This study is an attempt to find a causal relation between financial ratios and tax avoidance. Aside from direct financial responsibilities, we conjecture that firms that avoid taxes will also face indirect negative financial repercussions, such as degradation of their reputation in the investment market. Corporate Social Responsibility (CSR: Corporate Social Responsibility) activities are refl...

Corporate Social Responsibility, Stocks Prices and Tax Policy

We model a capital market in which some proportion of investors get utility from owning firms that undertake spending on corporate social responsibility (CSR). We also assume different categories of firms: those with good CSR fundamentals and those with poor CSR fundamentals. We develop an equilibrium in which investors’ CSR considerations influence their financial portfolio decisions, influenc...

Externalities of Corporate Tax Avoidance

We show that when a meaningful proportion of firms in an economy engage in tax avoidance strategies, the covariance between a firm’s cash flow and the market cash flows increases, thereby increasing a firm’s cost of capital. This negative externality is imposed on all firms in the economy, not just tax-avoiding firms. The negative externality results regardless of the level of uncertainty assoc...

Tax Avoidance , Corporate Transparency , and Firm Value

Individual and Corporate Social Responsibility

Individual and Corporate Social Responsibility Society’s demands for individual and corporate social responsibility as an alternative response to market and distributive failures are becoming increasingly prominent. We first draw on recent developments in the “psychology and economics” of prosocial behavior to shed light on this trend, which reflects a complex interplay of genuine altruism, soc...