Research seminar by Prof. VG Sridharan

Posted on January 13, 2025 by administrator

IIM K hosted its Seventh research seminar on January 09, 2025, for the year 2024-25. It was conducted by Prof. VG Sridharan, Professor of Finance, Accounting and Control, Indian Institute of Management, Kozhikode.

The topic was The Contagion Effect of CSR Restatements on Investors Judgements: Experimental Evidence

Abstract of the talk given below

Descriptive evidence suggests that global firms increasingly restate their corporate social responsibility (CSR) performance measures. While evidence on the adverse investment effects of financial restatements is established in the literature, there is little evidence on whether and how CSR restatements influence investors’ judgements.  In this study, we draw upon contagion theory to examine investors’ reactions to CSR restatements. We predict and find that CSR restatements made in firms adopting integrated (separate) reporting affect (unaffect) investors’ reliability perceptions of financial information, and consequently their investment judgements. Further, consistent with the theory, we also find that reasonable CSR assurance helps alleviate the adverse impact in the integrated reporting context. Our study is informative to global regulators and standard-setting bodies, given their ongoing considerations of CSR reporting requirements.

Keywords: CSR Restatements; Integrated Reporting; Contagion Theory; CSR Assurance.