Empirical Analysis of the Relationship Between CSR and Company’s Market Capitalization: Evidence from Bucharest Stock Exchange

Conference paper
Part of the Springer Proceedings in Business and Economics book series (SPBE)


The practice of corporate social responsibility (CSR) is much debated and criticized. There is a continuous debate regarding the link between CSR and corporate financial performance (CFP) because the narrative reviews of the literature and the empirical evidence are too varied and mixed in different country context to allow for definitive conclusions. This paper aims at empirically analyzing the relationship between CSR and company’s market capitalization, the indicator which measures the investors’ evaluation of a firm value. Starting from the existing literature, our paper investigates this relationship for the Romanian companies listed on Bucharest Stock Exchange (BSE). From a total of 85 listed companies, we selected only 70 of them which were listed on the BSE during the period 2010–2015, without being excluded from trading. Using panel least squares methodology, our results suggest a positive relationship between CSR activities and market capitalization of firms, which are also impacted by the dividend paid and return on equity. This is a clear clue that besides the financial performance of a firm, the investors take into account also the attitude of a firm regarding its CSR activities. Moreover, this paper highlights the benefits for both managers and investors, since CSR exerts a significant positive impact on the firm value.


Corporate social responsibility Bucharest stock exchange Panel least squares 


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© Springer International Publishing AG 2018

Authors and Affiliations

  1. 1.Alexandru Ioan Cuza University of Iaşi, Faculty of Economics and Business AdministrationIaşiRomania
  2. 2.Bucharest University of Economic Studies, Faculty of Finance and BankingBucharestRomania

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