News Release

Socially Responsible Corporations with Heavy PAC Contributors Associated with Higher Stock Returns

Companies that tout social responsibility and whose managers contribute to political action committees tend to provide higher returns to shareholders, suggests a new University of California, Davis, study.

“Especially for smaller public companies, if the firm has been active in disclosing corporate social responsibility measures and if the individuals in the company are politically active, there’s a good chance you will do better in the stock market if you invest in that company,” said Paul Griffin, a leading international authority in accounting and corporate disclosure and a professor at the UC Davis Graduate School of Management.

Griffin and co-author Yuan Sun, a doctoral candidate at the Haas School, UC Berkeley, analyzed extensive data on voluntary corporate social responsibility disclosures, campaign contributions and stock performance. Their findings are published in the working paper, “Strange Bedfellows? Voluntary CSR Disclosure and Politics.”

The researchers also found that companies were more likely to make social responsibility disclosures if they were headquartered in a so-called “blue state,” or one that traditionally has voted Democratic in national elections.

“We hypothesized that if a state where a corporation is located is blue, on balance, the customers, the suppliers, and even the shareholders have that same tendency to be blue,” Griffin said.

Griffin and Sun determined that companies that issue more press releases on CSRwire, an online news service that publishes reports issued by member organizations on issues related to sustainability and corporate social responsibility tend to have more management employees who contribute to political action committees. The correlation was strongest with individuals who donated to political action committees affiliated with the Democratic Party.

Additionally, the stock market reacted favorably when corporations posted news releases on the CSRwire. The market effect intensified if company managers also made contributions to political action committees.

“The effects on stock values of CSRwire releases are immediate and can continue for up to three months after the disclosure,” Griffin said.

Griffin cautioned that while the correlations are strong, researchers need to look more closely at the underlying pathways whereby CSR disclosure and political contributions combine to produce shareholder gains.

To measure companies’ social responsibility, the researchers studied more than 14,500 news releases posted between 2000 and 2011 by CSRwire. Griffin and Sun identified 4,781 releases that were issued by major, publicly traded U.S. companies.

The researchers also compiled Federal Election Commission data on individual contributions to political action committees for the same 11 years. The commission’s data lists the names, employers and job titles of individuals who donate to committees, as well as the political party affiliation of the committees.

Stock performance was measured by compiling stock movements of firms listed in a large database that includes stock prices of publicly traded firms.

Click to download the full study.

About the Graduate School of Management

Dedicated to preparing innovative leaders for global impact, the UC Davis Graduate School of Management is consistently ranked among the premier business schools in the United States and internationally. The school’s faculty members are globally renowned for their teaching excellence and research in advancing management thinking. Each year, the school provides a bold, innovative approach to management education to about 100 full-time MBA students at the UC Davis campus and 425 part-time MBA students in Sacramento and the San Francisco Bay Area. A Master of Professional Accountancy degree program launched in fall 2012.

About UC Davis

For more than 100 years, UC Davis has engaged in teaching, research and public service that matter to California and transform the world. Located close to the state capital, UC Davis has more than 32,000 students, more than 2,500 faculty and more than 21,000 staff, an annual research budget that exceeds $684 million, a comprehensive health system and 13 specialized research centers. The university offers interdisciplinary graduate study and more than 100 undergraduate majors in four colleges — Agricultural and Environmental Sciences, Biological Sciences, Engineering, and Letters and Science. It also houses six professional schools — Education, Law, Management, Medicine, Veterinary Medicine and the Betty Irene Moore School of Nursing.

Media contact(s):

Commands

Twitter Feed

Loading tweets...
News Release

UC Davis Part-Time MBA Ranked in Nation’s Top 9%
Fourth Consecutive Year among U.S News & World Report's Premier Programs

Image of UC Davis Part-Time MBA Ranked in Nation’s Top 9%

(Davis, CA) — The UC Davis Part-Time MBA program offered in Sacramento and the San Francisco Bay Area is ranked among the top 9% in the U.S., according to U.S. News & World Report’s latest graduate business school rankings.

At No. 29, this is the fourth consecutive year the UC Davis Part-Time MBA program is among the top AACSB International-accredited part-time MBA programs surveyed. This year, there were 323 part-time MBA programs surveyed.

News Release

UC Davis Full-Time MBA Ranked among Nation’s Premier Programs for 20th Consecutive Year
MBA Programs among Top 10% in U.S.
Record Salary and Bonus

Image of UC Davis Full-Time MBA Ranked among Nation’s Premier Programs for 20th Consecutive Year

(Davis, CA) — The UC Davis Graduate School of Management’s Full-Time MBA program is ranked among the premier business schools in the nation for the 20th consecutive year, according to U.S. News & World Report’s latest graduate business school rankings released today.

U.S. News’ latest ranking places the Full-Time MBA program at No. 48, placing it among the top 10% of the 464 Association to Advance Collegiate Schools of Business International’s accredited full-time MBA programs surveyed.

Key statistics from the School’s Full-Time MBA ranking include:

News Release

UC Davis Graduate School of Management partners with Lawrence Livermore and Sandia National Labs to drive technologies from lab to market

Image of UC Davis Graduate School of Management partners with Lawrence Livermore and Sandia National Labs to drive technologies from lab to market

(Davis, Calif.) – With a joint goal of speeding the transfer of new technologies from the laboratory to the commercial marketplace, the UC Davis Graduate School of Management, Lawrence Livermore National Laboratory and Sandia National Laboratories have announced a new partnership for researchers to develop their entrepreneurial skills.

Spotlight Story

Vickie Sherman MBA 13 Finds Her Passion, Her Career—and Herself

Image of Vickie Sherman MBA 13 Finds Her Passion, Her Career—and Herself

What opportunities, decisions, events have shaped your professional life?

My career path has been a climb across a jungle gym rather than a tangent up a corporate ladder. As a child, I used to thumb through the three-inch JCPenney catalogue, picking out the professional women who I would grow to be. I wanted to rule the world from a corner office in a suit and heels. I wanted to shed my humble origins and become Corporate Barbie.

Spotlight Story

MBA Student Consultants Make an IMPACT
Projects Put Business Needs Front and Center

Image of MBA Student Consultants Make an IMPACT

Agilent Technologies’ Electronic Measurement Group is a $3.6 billion business that over the past decade has seen a dramatic shift in its customer base from U.S., and Western European customers to predominantly Asia-based customers. Today, the majority of the division’s revenues are generated outside of the U.S., with an increasing concentration in China.