Date Approved

2017

Date Posted

7-20-2017

Degree Type

Open Access Senior Honors Thesis

Department

Accounting and Finance

First Advisor

Lois S. Mahoney

Second Advisor

Joseph A. Scazzero

Third Advisor

Randall Hucks

Abstract

As globalization has increased, so too has the number of companies practicing corporate social responsibility (CSR) around the world. Social and environmental issues like global warming has been an underlying factor in this growing importance (Peng, 2012). Increasingly, companies are communicating their activities through CSR reports that outline corporate initiatives to access and take responsibility for the company's effects on the global environment and impact on social welfare. In this paper, we will expand on previous results found in "A Study of a How CSR Rankings Are Affected in a Globalized Economy", which is published in McNair Scholars Research Journal, Vol. 9 Issue 1. In the article, we statistically compared Environmental, Social, Governance, and Total CSR rankings using Sustainalytics Global Platform (SOP) Data for 6 regions: (1) North America, (2) South America, (3) Latin America, (4) Asia Pacific, (5) Africa, and (6) Europe. The statistical analysis found that regions of Africa, Europe, and South America consistently had higher Total CSR scores, followed by North America, while the regions of Latin America and Asia Pacific had the lowest CSR scores.

We expand upon the regional analysis by comparing a country's CSR score, based on a random sample of firms in a country, with six of Hofstede et al. (2010) cultural dimensions. Regression analysis was used to examine the relationship between a country's Total, Environmental, Social and Governance CSR scores and the components of culture, Power Distance, Individualism, Masculinity, Uncertainty Avoidance, Long-term Orientation and Indulgence. Results of this analysis showed that four of the six cultural dimensions were significantly re]ated to at least one type of CSR score. Masculinity had a significant negative association to Total CSR, Social CSR, and Governance CSR while Uncertainty Avoidance had a significant positive association with Total CSR, Environmental CSR, and Social CSR. Long-term Orientation was significantly positively associated with Environmental CSR while Indulgence was significantly positively associated with only Governance CSR. Power Distance and Individualism were not significantly related to any of the four dimensions of CSR. These results suggest that CSR vary by region and culture may play a role in CSR levels.

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