Rethinking capital structure decision and corporate social responsibility in response to COVID-19

Huang, He, and Ye, April (2021) Rethinking capital structure decision and corporate social responsibility in response to COVID-19. Accounting and Finance. (In Press)

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View at Publisher Website: https://doi.org/10.1111/acfi.12740
 
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Abstract

COVID-19 has severely constricted the global economic activities. This paper examines the joint effect of capital structure and corporate social responsibility (CSR) activities on firm risk during COVID-19. We find that firms having excessive debt beyond the optimal level experienced high firm risk during the pandemic and the effect is more prevalent among firms with poor CSR performance. In contrast, firms with a debt level below the optimum are self-protected regardless of their CSR practices. Our study provides businesses with insights of post-pandemic directions on capital structure and CSR policies to build up sustainability and resilience in a volatile market.

Item ID: 65286
Item Type: Article (Research - C1)
ISSN: 1467-629X
Keywords: COVID-19, Capital structure, Financial risk, CSR, Corporate Social Responsibility
Date Deposited: 09 Dec 2020 04:39
FoR Codes: 15 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 1502 Banking, Finance and Investment > 150201 Finance @ 70%
15 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 1503 Business and Management > 150303 Corporate Governance and Stakeholder Engagement @ 30%
SEO Codes: 91 ECONOMIC FRAMEWORK > 9102 Microeconomics > 910205 Industry Policy @ 50%
91 ECONOMIC FRAMEWORK > 9101 Macroeconomics > 910109 Savings and Investments @ 50%
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