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Finance & Accounting
Pages 6 (1506 words)
Introduction Part (The relationship between stock price and company's social responsibility) Contents Contents 2 Background and history 3 Rational for the research 4 Findings on Corporate social responsibility and stock prices 5 Aims and objectives 6 Research questions 7 References 8 Background and history Corporate social responsibility has attained significance over the past few decades as the investors are increasingly aware of the ethical, social and environmental responsibilities fulfilled by the companies.
Over the last two decades, the different rating agencies have focussed on developing innovative methodologies for evaluation of social performance of the companies. The evaluation is important as the non-financial performance of the companies like corporate social responsibility reflects the strategic policies of the company gives an insight of the future course of action and business of the companies. Undertaking corporate social responsibility leads to spread of information in the market that the company is looking to maintain a stable environment and reduce the damages caused to the society as an effect of its operations. Thus the information flow to the market gives an understanding of the long term plans and sustainability of the companies. As a result of this flow of information, the decision of the market investors, suppliers, creditors, customers would vary in terms of entering into a relationship with the company. The activities of corporate social responsibility also pass the information on the profitability, retained earnings, capability to engage in non-financial performance. ...
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