Faculty of Business External Research Seminar| Finance | Begüm İpek Yavuz

FINANCE WORKSHOP SERIES

Date: Fri, Dec 29, 2023
Time: 11:30-13:00
Location: AB2 345

Speaker: Begüm İpek Yavuz (McGill). 

Title: Corporate Governance and Greenwashing: Reevaluating CSR

Abstract: In this paper, I examine the effect of corporate governance on corporate social responsibility (CSR). Using exogenous variations in board structures to draw causal inference, I show that enhanced corporate governance, specifically increased board independence, tends to reduce CSR activities. This reduction is attributed to the mitigation of agency conflicts, suggesting that managers may overinvest in CSR to cultivate a socially responsible image, potentially at the expense of shareholder value. The findings reveal a nuanced view of CSR, underscoring the importance of balancing CSR with shareholder value to prevent greenwashing.