Corporate Social Responsibility, Trade Credit and Financial Crisis

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ID: 115232
2020
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Abstract
Socially responsible firms receive more finance and have been well researched in the corporate finance literature. In this paper, we examine the relationship between CSR and trade credit. Using data from the US manufacturing industry, we find that CSR has a significant positive association with the buyer and supplier sides of trade credit. During the 2008–2009 financial crisis, the manufacturing industry trade badly fell. We also argue and find evidence that, during crisis, CSR is negatively associated with trade credit. These findings are robust for alternate proxies of CSR and trade credit, sample selection, and time period. Moreover, the potential endogeneity concerns do not affect our results. Finally, we show that this relationship exists for both domestic and multinational firms’ subsamples. Overall, our results indicate that firms with high social performance use more trade credit to increase their business activity.
Reference Key
saeed2020journalcorporate Use this key to autocite in the manuscript while using SciMatic Manuscript Manager or Thesis Manager
Authors Asif Saeed;Qasim Zureigat;Saeed, Asif;Zureigat, Qasim;
Journal journal of risk and financial management
Year 2020
DOI
10.3390/jrfm13070144
URL
https://doi.org/10.3390/jrfm13070144
Keywords
crisis corporate social responsibility multinationals trade credit crisis multinationals trade credit keywords: corporate social responsibility

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