Search results

India has mandated corporate social responsibility (CSR) expenditure under Section 135 of the Indian Companies Act, 2013 – the first national jurisdiction to do so. The purpose of this paper is to examine the impact of mandated CSR expenditure on firms’ stock returns by using actual CSR spending data, whereas the previous studies mostly focus on voluntary CSR proxied by CSR scores.

The authors estimate their baseline regression by using ordinary least squares(OLS) method. Although the baseline regression involving CSR expenditure and stock returns using ordinary least squares method are estimated, endogeneity and reverse causality biases are addressed by using two-stage least squares and generalized method of moments approaches. These approaches contribute mitigating endogeneity bias and biases associated with unobserved heterogeneity and simultaneity.

The findings document that mandatory CSR expenditure has a negative impact on firms’ stock returns which supports the “shareholders” expense’ view. This result remain robust after controlling for endogeneity bias and the use of both standard and robust test statistics. The authors however observe that this result holds for the firms with actual CSR expenditure equal to the mandated amount but does not hold for the firms with actual CSR expenditure greater than the mandated amount. Therefore, the authors provide evidence that CSR expenditure’s impact on stock returns depends on whether firms simply comply the regulation or voluntarily chose an amount of CSR expenditure above the mandated amount.

The primary contribution is to present a valid and robust evidence of negative effect of mandated CSR spending on firms’ stock returns when the mandatory CSR spending rule is already in place. This study contributes by examining the impact of mandated CSR spending on stock during post-implementation period (2015-2017), whereas other studies by Dharampala and Khanna (2018); Kapoor and Dhamija (2017); and Mukherjee et al. (2018) mainly examined the impact of legislation on Indian CSR. The authors use mandated actual CSR expenditure, whereas previous studies mostly focus on voluntary CSR proxied by CSR scores.

Among the many studies about risk perception, only a few deal with Bangladesh. Paul and Bhuiyan’s (2010) study has shown the earthquake-preparedness level of residents of Dhaka, but there are some biases in the data collection. This paper aims to examine the seismic-risk perception and the level of knowledge on earthquake and preparedness among the residents of Dhaka.

A questionnaire was developed, and data collection was undertaken through home and sidewalk surveys. This paper investigates how attitude, perception and behavior differ depending on gender, age, education and casualty awareness. This research tries to examine and make a comparison of the risk perception and preparedness level between different groups of gender, age and level of education.

This research shows that female respondents have a much better risk perception of and are better prepared for earthquakes than male respondents; younger people have a higher knowledge about earthquake preparedness than older people and less-educated people are at a higher risk of unpreparedness than more-educated people.

This research is only limited to the Dhaka Division.

This paper concludes by noting that public awareness on seismic-risk perception and mitigation is poor, and their knowledge on basic theory and emergency response must be improved.