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Full-Text Articles in Finance and Financial Management
The Impact Of Stakeholder Orientation On Tax Avoidance: Evidence From A Natural Experiment, Gary Chen, Ani Manakyan Mathers, Bin Wang, Xiaohong Wang
The Impact Of Stakeholder Orientation On Tax Avoidance: Evidence From A Natural Experiment, Gary Chen, Ani Manakyan Mathers, Bin Wang, Xiaohong Wang
Finance Faculty Research and Publications
We study the effect of stakeholder orientation on corporate tax avoidance. Using the staggered passage of constituency statutes across U.S. states between 1983 and 2006, we show that greater stakeholder orientation results in increased tax avoidance. We further find greater tax avoidance among firms with limited financial resources and that employees benefit from the change. Our results are consistent with stakeholder salience theory that resource-constrained managers prioritize the claims of salient stakeholders, such as employees, at the expense of secondary stakeholders, such as the government.
Corporate Social Responsibility And Information Flow, Gary Chen, Bin Wang, Xiaohong Wang
Corporate Social Responsibility And Information Flow, Gary Chen, Bin Wang, Xiaohong Wang
Finance Faculty Research and Publications
We find that a firm's greater commitment to corporate social responsibility (CSR) increases firm- specific information incorporated into stock prices. We further show that information searches increase around major disclosure events for firms that are more socially responsible, as observed through requests for newly released annual (10-K) filings on EDGAR and company ticker searches on Google around earnings announcements. Using alternative empirical specifications, we establish a robust and positive relation between CSR and stock price informativeness. Our results are consistent with the ethical and reputational view that a commitment to CSR encourages information acquisition and facilitates information flow into stock …
Institutional Investors And Corporate Environmental, Social, And Governance Policies: Evidence From Toxics Release Data, Incheol Kim, Hong Wan, Bin Wang, Tina Yang
Institutional Investors And Corporate Environmental, Social, And Governance Policies: Evidence From Toxics Release Data, Incheol Kim, Hong Wan, Bin Wang, Tina Yang
Finance Faculty Research and Publications
This paper studies the role of institutional investors in influencing corporate environmental, social, and governance (ESG) policies by analyzing the relation between institutional ownership and toxic release from facilities to which institutions are geographically proximate. We develop a local preference hypothesis based on the delegated philanthropy and transaction-costs theories. Consistent with the hypothesis, local institutional ownership is negatively related to facility toxic release. The negative relation is stronger for local socially responsible investing (SRI) funds, local public pension funds, and local dedicated institutions. We also find that the relation is more negative in communities that prefer more stringent environmental policies …