External CSR Rating Influences on Shareholder Voting Patterns for CSR Shareholder-Sponsored Proposals
Document Type
Book Chapter
Keywords
Corporate Social Responsibility; CSR Shareholder-sponsored Proposals; Shareholder Voting Patterns; Stakeholder Theory; Legitimacy Theory
Identifier Data
https://doi.org/10.1108/S1574-076520180000021004
Publisher
Emerald Publishing Limited
Publication Source
Research on Professional Responsibility and Ethics in Accounting (Research on Professional Responsibility and Ethics in Accounting, Vol. 21
Rights Management
Copyright © 2018 Emerald Publishing Limited
Abstract
We examine the perceived influence of externally generated firm ratings of corporate social responsibility (CSR) on voting for shareholder-sponsored CSR proposals. Using stakeholder and legitimacy theories, we introduce two rationales that relate shareholder voting decisions to the firm’s CSR performance: the complementary perspective where investors rely on management’s branding or image of the firm for CSR performance, and the sufficiency perspective where shareholders consider legitimacy effects of firm CSR performance. Our examination of 473 CSR shareholder-sponsored proposals during the 2013 to 2015 proxy seasons reveals a negative relationship between support for shareholder-sponsored CSR proposals and CSR strengths, particularly for social and environmental CSR strengths. We also find a positive relationship between support for shareholder-sponsored CSR proposals and CSR concerns, particular in the area of environmental CSR concerns. These results partially support the sufficiency perspective that incorporates shareholder legitimacy concerns. When companies have poor CSR performance, shareholders may view further CSR initiatives as beneficial to the firm.
