Capitalizing on a distinctive measure of corporate culture obtained from sophisticated machine learning, we investigate the concept of cultural diversification. A firm is culturally diversified if it is characterized by a variety of diverse cultural attributes. Motivated by agency theory, we...

Exploiting a distinctive measure of corporate culture based on advanced machine learning, we investigate the effect of board gender diversity on corporate culture. Our results demonstrate that greater board gender diversity considerably strengthens positive corporate culture. The findings...

Motivated by the on-going debate on the costs and benefits of CSR, we explore how talented managers view CSR investments. Based on nearly 20,000 observations across 17 years, our evidence reveals a non-monotonic effect of managerial talent on CSR. Exploiting a novel measure of managerial ability...

We exploit the Great Recession of 2008 to study how firms view corporate social responsibility (CSR). When confronted with an adverse exogenous shock, firms are forced to prioritize. Our results show that, during the Great Recession, firms do not lessen their overall CSR investments, suggesting...

We investigate the effect of political risk on shareholder value, using an event study and a novel measure of firm-level political risk recently developed by Hassan et al. (2019). We exploit the guilty plea of Jack Abramoff, a well-known lobbyist, on January 3, 2006, as an exogenous shock that...

Motivated by agency theory, we investigate the effect of managerial ownership on CSR engagement. Exploiting Lewbel's (2012) heteroskedastic identification and using a large U.S. sample of over 14,000 observations across 18 years, we find that higher managerial ownership diminishes CSR engagement...

We investigate the effect of Lesbian, Gay, Bisexual and Transgender (LGBT)-supportive corporate policies on credit ratings. To the extent that LGBT-friendly policies are beneficial to the firm and therefore improve its expected cash flows, credit rating agencies should assign more favorable...

This study investigates the performance of socially controversial companies during a financial crisis. Companies are usually considered controversial if they are involved in controversial businesses such as alcohol, tobacco, firearms, nuclear etc. The results show that controversial firms...

We investigate how independent directors view corporate social responsibility (CSR). Exploiting the passage of the Sarbanes-Oxley Act (SOX) and the associated exchange listing requirements as an exogenous regulatory shock, we document that independent directors view CSR activities unfavorably....

We explore the effect of board independence on CSR investments during a stressful time, i.e. during the Great Recession. Our results show that independent directors exhibit an unfavorable view of CSR investments during the crisis. Stronger board independence leads to a significant reduction in...