Does Geographical Proximity Affect Corporate Social Responsibility? Evidence from U.S. Market

Ardisak Boeprasert

Abstract


Corporate Social Responsibility is considered as a key corporate agenda in recent years. This study examines the relation between geographical proximity to metropolitan areas and corporate social responsibility. Methodologically, sample firms are classified by their distance to top-metropolitan area of Census 2010. Corporate social responsibility follows scoring system, which has been developed by the notable KLD Research & Analytics. Based on the samples from U.S. listed firms, the results support the main hypothesis that firm locating further from metropolitan areas tends to commit greater degree of social responsibility than those locating nearby top-metropolitan areas. Social responsible activities are exploited as a mean to alleviate information asymmetry and agency conflict rose from a distance. Besides, further investigation shows that the results above are potentially explained by some attributes of corporate social responsibility. These results are important to academic field because they show that the extent of any non-financial corporate activity, i.e. corporate social responsibility, can be explained by its geographical background.

Full Text: PDF DOI: 10.5539/ibr.v5n9p138

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This work is licensed under a Creative Commons Attribution 3.0 License.

International Business Research  ISSN 1913-9004 (Print), ISSN 1913-9012 (Online)

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