Flotation costs of seasoned equity offerings: Does corporate social responsibility matter?

Zhe Li, Ping Wang

    Research output: Contribution to journalArticlepeer-review

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    Abstract

    This paper investigates the effect of corporate social responsibility (CSR) on flotation costs in seasoned equity offerings (SEOs). On the basis of an international sample covering 38 countries during the period 2002–2018, we find that CSR performance is negatively associated with SEO flotation costs and this negative impact is mainly attributable to issuers' engagement in CSR, particularly in environmental and social activities. We further reveal that the CSR strategies of SEO issuers are successful in reducing market-based costs as well. Overall, this paper offers critical insights for understanding the role of stakeholder-oriented practices in adding value to shareholders through equity offerings.
    Original languageEnglish
    JournalEuropean Financial Management
    Early online date15 Jun 2021
    DOIs
    Publication statusE-pub ahead of print - 15 Jun 2021

    Keywords

    • corporate social responsibility
    • flotation costs
    • market-based costs
    • seasoned equity offerings

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