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Reputation and Charity, Signaling and Economic Hypotheses of Corporate Social Responsibility

    Authors

    1 Ph.D. of Accounting Student, Faculty of Economics and Management, Urmia University, Urmia, Iran.

    2 Associate Professor of Accounting, Faculty of Economics and Management, ,Urmia University, Urmia, Iran.

    3 Associate Professor of Accounting, Faculty of Economics and Management, Urmia University, Urmia, Iran.

,

Document Type : Research Paper

Abstract

Purpose: The purpose of this research is to investigate the existence of motivations related to charity, signaling, and economic hypotheses of social responsibility, as well as the role of reputation in creating these motivations, if any.
Method: This research is practical in terms of its purpose and falls under the category of descriptive-correlational research due to its examination of the relationship between variables. Based on the applied conditions and restrictions, the screened statistical sample consisted of 101 companies admitted to the Tehran Stock Exchange during the years 1392 to 1401 and was tested using multivariate regression models.
Results: The results indicate that the participation of companies in social responsibility activities is driven by motivations other than charitable goals. The company's reputation has a positive and significant effect on optimal social responsibility, which includes economic motivations. It also has a negative and significant effect on deviations from optimal social responsibility.
Conclusion: Companies can perform better by implementing social responsibility activities driven by motives beyond benevolent goals. Companies with higher reputations engage in social responsibility activities with economic and profit goals. These reputable companies are less likely to send opportunistic signals through social responsibility, resulting in more optimal social responsibility aimed at economic goals, profit earning, and increasing the company's value.
Contribution: By examining three hypotheses of charity, economic, and signaling, this research aims to clarify the motivations of companies in carrying out social responsibility activities. It seeks to determine which of these hypotheses is most consistent with reality and how companies with high reputations exploit these activities. Conducting this research can enhance understanding in this area. The results can help company managers adopt better strategies for managing their reputation and social responsibility, and assist researchers in better understanding the relationship between corporate reputation and social responsibility activities.

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References
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Financial Accounting Knowledge
Volume 11, Issue 3 - Serial Number 42
September 2024
Pages 161-182
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