Managing risk with socially responsible actions in firms involved in controversial activities and earnings management

Encarna Guillamón-Saorín; Andrés Guiral; Belen Blanco

doi:10.1080/02102412.2017.1346913

Managing risk with socially responsible actions in firms involved in controversial activities and earnings management

Encarna Guillamón-Saorín, Andrés Guiral, Belen Blanco

Department of Business Administration

Research output: Contribution to journal › Article › peer-review

8 Citations (Scopus)

Abstract

This study examines the impact of earnings quality on the association between corporate social responsibility and firm’s risk in firms involved in controversial activities. Based on a US sample over the 2004–2008 period, we find that involvement in controversial issues increases risk of firms despite their engagement in social responsibility activities. Additionally, we find that firms involved in controversial activities that manage their earnings upward, increase levels of risk, no matter if they engage in social responsible actions or not.

Original language	English
Pages (from-to)	1-24
Number of pages	24
Journal	Revista Espanola de Financiacion y Contabilidad
Volume	47
Issue number	1
DOIs	https://doi.org/10.1080/02102412.2017.1346913
Publication status	Published - 2018 Jan 2

Bibliographical note

Funding Information:
Andrés Guiral acknowledges financial contribution by the Ministry of Education of the Republic of Korea [Grant Number: NRF2015S1A3A2046811] and the research support of the YSB Center for Global Business Ethics and Responsibility Encarna Guillamón-Saorín acknowledges financial contribution from the Spanish Ministry of Science and Innovation (SEJ2007-67582-C02-02/ECON, ECO2010-19314) and Comunidad Autonoma de Madrid (SEJ2008-00059-003. SEJ2016-00059-001). Belen Blanco acknowledges financial assistance from the Spanish Ministry of Innovation and Science (ECO2010-19314, ECO2008-06238- C02-01/ECON, SEJ2007-67582-C02-02/ECON, ECO2009-10796 and Consolider Grant #2006/04046/002). We acknowledge useful comments from participants at the European Accounting Association Annual Conference, Paris, 2013 and seminar participants at Yonsei University.

Funding Information:
Andrés Guiral acknowledges financial contribution by the Ministry of Education of the Republic of Korea [Grant Number: NRF2015S1A3A2046811] and the research support of the YSB Center for Global Business Ethics and Responsibility Encarna Guillamón-Saorín acknowledges financial contribution from the Spanish Ministry of Science and Innovation (SEJ2007-67582-C02-02/ ECON, ECO2010-19314) and Comunidad Autonoma de Madrid (SEJ2008-00059-003. SEJ2016-00059-001). Belen Blanco acknowledges financial assistance from the Spanish Ministry of Innovation and Science (ECO2010-19314, ECO2008-06238-C02-01/ECON, SEJ2007-67582-C02-02/ECON, ECO2009-10796 and Consolider Grant #2006/04046/002).

Publisher Copyright:
© 2017 Asociación Española de Contabilidad y Administración de Empresas (AECA).

All Science Journal Classification (ASJC) codes

Accounting
Finance
Economics and Econometrics

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1080/02102412.2017.1346913

Cite this

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title = "Managing risk with socially responsible actions in firms involved in controversial activities and earnings management",

abstract = "This study examines the impact of earnings quality on the association between corporate social responsibility and firm{\textquoteright}s risk in firms involved in controversial activities. Based on a US sample over the 2004–2008 period, we find that involvement in controversial issues increases risk of firms despite their engagement in social responsibility activities. Additionally, we find that firms involved in controversial activities that manage their earnings upward, increase levels of risk, no matter if they engage in social responsible actions or not.",

author = "Encarna Guillam{\'o}n-Saor{\'i}n and Andr{\'e}s Guiral and Belen Blanco",

note = "Funding Information: Andr{\'e}s Guiral acknowledges financial contribution by the Ministry of Education of the Republic of Korea [Grant Number: NRF2015S1A3A2046811] and the research support of the YSB Center for Global Business Ethics and Responsibility Encarna Guillam{\'o}n-Saor{\'i}n acknowledges financial contribution from the Spanish Ministry of Science and Innovation (SEJ2007-67582-C02-02/ECON, ECO2010-19314) and Comunidad Autonoma de Madrid (SEJ2008-00059-003. SEJ2016-00059-001). Belen Blanco acknowledges financial assistance from the Spanish Ministry of Innovation and Science (ECO2010-19314, ECO2008-06238- C02-01/ECON, SEJ2007-67582-C02-02/ECON, ECO2009-10796 and Consolider Grant #2006/04046/002). We acknowledge useful comments from participants at the European Accounting Association Annual Conference, Paris, 2013 and seminar participants at Yonsei University. Funding Information: Andr{\'e}s Guiral acknowledges financial contribution by the Ministry of Education of the Republic of Korea [Grant Number: NRF2015S1A3A2046811] and the research support of the YSB Center for Global Business Ethics and Responsibility Encarna Guillam{\'o}n-Saor{\'i}n acknowledges financial contribution from the Spanish Ministry of Science and Innovation (SEJ2007-67582-C02-02/ ECON, ECO2010-19314) and Comunidad Autonoma de Madrid (SEJ2008-00059-003. SEJ2016-00059-001). Belen Blanco acknowledges financial assistance from the Spanish Ministry of Innovation and Science (ECO2010-19314, ECO2008-06238-C02-01/ECON, SEJ2007-67582-C02-02/ECON, ECO2009-10796 and Consolider Grant #2006/04046/002). Publisher Copyright: {\textcopyright} 2017 Asociaci{\'o}n Espa{\~n}ola de Contabilidad y Administraci{\'o}n de Empresas (AECA).",

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Managing risk with socially responsible actions in firms involved in controversial activities and earnings management

Abstract

Bibliographical note

All Science Journal Classification (ASJC) codes

UN SDGs

Access to Document

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