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A1821
Topic: Contributed on Corporate finance Title: Corporate social responsibility performance and firm performance in the global shipping industry Authors:  Manolis Kavussanos - Athens University of Economics and Business (Greece)
Dimitris Tsouknidis - Cyprus University of Technology (Cyprus) [presenting]
Abstract: The aim is to investigate whether corporate social responsibility (CSR) performance causes higher firm performance in the global shipping industry. By utilizing a global sample of 33 shipping firms over the period 2002 to 2013, we provide strong evidence of a positive relationship between firm performance and CSR. In addition the study corrects for the fact that previous studies in the general finance literature and in the shipping literature, suffer from endogeneity problems such as simultaneity (reverse causality) and unobserved heterogeneity. This is achieved through the estimation of a dynamic panel (system) generalized method of moments (GMM) estimator, which takes into account that endogeneity often arises with a time lag (dynamic endogeneity), leading to biased results and doubtful inferences. Results reveal the financial benefits of engaging in CSR activities for the shipping sector and contribute to a better understanding of the governing mechanisms between financial performance and CSR. Thus, devoting resources on increasing CSR performance is expected to yield significant future financial benefits for shipping companies worldwide.