Can corporate social responsibility bias lending decisions?. Issue 4 (1st October 2016)

• Record Type: Journal Article
• Authors: Guiral, Andres; Moon, Doocheol; Perez-Garcia, Javier
• Is Part Of: Revista española de financiación y contabilidad. Volume 45:Issue 4(2016)
• Page Start: 466
• Page End: 486
• Publication Date: 2016-10-01
• Subjects: Corporate social performance -- customer awareness -- lending decisions; C91 -- D81 -- M14 -- G30 -- G21; Finance -- Spain -- Periodicals; Finance -- Periodicals; Accounting -- Spain -- Periodicals; Accounting -- Periodicals; Banks and banking -- Periodicals; 332.094605
• DOI: 10.1080/02102412.2016.1240415
• Languages: English
• ISSNs: 0210-2412

Abstract

ABSTRACT: Recent research suggests that the effect of Corporate Social Responsibility performance (CSRp) on firm value is conditional on its ability to influence stakeholders through customer awareness. This study extends previous research using an experiment to investigate whether the impact of CSRp ratings on lending decisions is moderated by the level of customer awareness. Results using experienced loan officers from an international commercial bank indicate that lending decisions are likely to be biased since CSRp ratings are interpreted as a signal for superior financial performance regardless of the level of customer awareness. Our findings suggest that loan officers are susceptible to further training in the correct interpretation of CSRp.