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The Effects of CSR Input on Valuation and Accounting Quality -- Biotechnology and Medical Industries

Received: 22 April 2016     Accepted: 9 May 2016     Published: 25 May 2016
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Abstract

This paper examines the effects of the corporate social responsibility (CSR) input on company’s valuation and accounting quality by using the samples of biotechnology and medical industries. After considering the interaction term between the accounting quality and CSR, this paper further examine whether the companies which input higher CSR will not be wrong valuation from the market. The findings show that the companies with a higher CSR, their stock prices are less likely to be underpriced by the market. The companies with higher prior period’s CSR have better current period’s accounting quality. After controlling for the interaction between accounting quality and CSR, the companies which input higher CSR at current and lagged-one periods are less likely to be under-valuation by the market.

Published in Journal of Finance and Accounting (Volume 4, Issue 3)
DOI 10.11648/j.jfa.20160403.17
Page(s) 146-156
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2016. Published by Science Publishing Group

Keywords

Corporate Social Responsibility, Accounting Quality, Mispricing, Business Valuation

References
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Cite This Article
  • APA Style

    Ling-Hui Cho, Li-Kai Liao. (2016). The Effects of CSR Input on Valuation and Accounting Quality -- Biotechnology and Medical Industries. Journal of Finance and Accounting, 4(3), 146-156. https://doi.org/10.11648/j.jfa.20160403.17

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    ACS Style

    Ling-Hui Cho; Li-Kai Liao. The Effects of CSR Input on Valuation and Accounting Quality -- Biotechnology and Medical Industries. J. Finance Account. 2016, 4(3), 146-156. doi: 10.11648/j.jfa.20160403.17

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    AMA Style

    Ling-Hui Cho, Li-Kai Liao. The Effects of CSR Input on Valuation and Accounting Quality -- Biotechnology and Medical Industries. J Finance Account. 2016;4(3):146-156. doi: 10.11648/j.jfa.20160403.17

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  • @article{10.11648/j.jfa.20160403.17,
      author = {Ling-Hui Cho and Li-Kai Liao},
      title = {The Effects of CSR Input on Valuation and Accounting Quality -- Biotechnology and Medical Industries},
      journal = {Journal of Finance and Accounting},
      volume = {4},
      number = {3},
      pages = {146-156},
      doi = {10.11648/j.jfa.20160403.17},
      url = {https://doi.org/10.11648/j.jfa.20160403.17},
      eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20160403.17},
      abstract = {This paper examines the effects of the corporate social responsibility (CSR) input on company’s valuation and accounting quality by using the samples of biotechnology and medical industries. After considering the interaction term between the accounting quality and CSR, this paper further examine whether the companies which input higher CSR will not be wrong valuation from the market. The findings show that the companies with a higher CSR, their stock prices are less likely to be underpriced by the market. The companies with higher prior period’s CSR have better current period’s accounting quality. After controlling for the interaction between accounting quality and CSR, the companies which input higher CSR at current and lagged-one periods are less likely to be under-valuation by the market.},
     year = {2016}
    }
    

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    T1  - The Effects of CSR Input on Valuation and Accounting Quality -- Biotechnology and Medical Industries
    AU  - Ling-Hui Cho
    AU  - Li-Kai Liao
    Y1  - 2016/05/25
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    N1  - https://doi.org/10.11648/j.jfa.20160403.17
    DO  - 10.11648/j.jfa.20160403.17
    T2  - Journal of Finance and Accounting
    JF  - Journal of Finance and Accounting
    JO  - Journal of Finance and Accounting
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    EP  - 156
    PB  - Science Publishing Group
    SN  - 2330-7323
    UR  - https://doi.org/10.11648/j.jfa.20160403.17
    AB  - This paper examines the effects of the corporate social responsibility (CSR) input on company’s valuation and accounting quality by using the samples of biotechnology and medical industries. After considering the interaction term between the accounting quality and CSR, this paper further examine whether the companies which input higher CSR will not be wrong valuation from the market. The findings show that the companies with a higher CSR, their stock prices are less likely to be underpriced by the market. The companies with higher prior period’s CSR have better current period’s accounting quality. After controlling for the interaction between accounting quality and CSR, the companies which input higher CSR at current and lagged-one periods are less likely to be under-valuation by the market.
    VL  - 4
    IS  - 3
    ER  - 

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Author Information
  • Yung Zip Chemical Ind. Co., Ltd., Taichung, Taiwan

  • Department of Accounting, Tunghai University, Taichung, Taiwan

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