Lahrech, Houssam (2011) DISARMING THE VALUE KILLERS: CSR VIEWED THROUGH A SHARP RISK MANAGEMENT LENS. [Dissertation (University of Nottingham only)] (Unpublished)

PDF - Requires a PDF viewer such as GSview, Xpdf or Adobe Acrobat Reader
Download (1MB) | Preview


Why should rational, profit maximizing managers invest in managing CSR related risks? In this study, I propose a comprehensive framework for viewing CSR through a new risk management lens; a lens which would allow both managers and mainstream investors to reconsider the endless debate of the impact of CSR on the financial performance of the firm from another perspective. The main objective of this paper is to provide an insight on the shift in the risk management mindset with the recent development in Enterprise Risk Management (ERM). This relatively new notion provides a stronger ground for integrating CSR issues at the heart of the business risk model since it consider risks from a broader perspective. A perspective which allows for consideration for all types of risks including emerging CSR related risks. With ERM at the central stage, I develop a theoretical framework which would allow CSR and risks to converge. This framework is composed of 4 distinct constructs: Stakeholders‘ vulnerability assessment, corporate governance, communication, and financial performance.

But why should managers invest resources and time to consider building an efficient ERM system? To answer this question, I use an event study methodology to explore the effect of CSR related negative events on abnormal stock returns surrounding a sample drawn from the FTSE 100 companies listed between 2007 and 2011. Privilege access to Vigeo methodology allows for linking the CSR event type with a distinct risk category. The results indicate strong support for the idea that negative CSR related risks have an impact on shareholders‘ value. The study suggests that reputation and legal risks are significant value killers, since these risks have materialized in tangible forms leading to significant negative abnormal returns.

Item Type: Dissertation (University of Nottingham only)
Keywords: CSR risks, Enterprise Risk Management, Event Study, Risk Management
Depositing User: EP, Services
Date Deposited: 30 Nov 2022 10:17
Last Modified: 01 Dec 2022 04:30
URI: https://eprints.nottingham.ac.uk/id/eprint/25198

Actions (Archive Staff Only)

Edit View Edit View