https://www.carijournals.org/journals/index.php/IJF/issue/feed 2024-03-20T01:25:57+03:00 Journal Admin journals@carijournals.org Open Journal Systems <p>The International Journal of Finance (IJF) is a journal that publishes high-quality research in finance. It is open access, peer-reviewed, and hosted by CARI Journals. The journal covers various topics in finance, such as financial markets, corporate finance, financial regulation, and financial education. The journal accepts online submissions and publishes papers immediately after registration. The journal is indexed in many databases and has a high impact factor. The IJF is a platform for scholars, practitioners, and policymakers to share their knowledge and insights in finance.</p> https://www.carijournals.org/journals/index.php/IJF/article/view/1733 2024-03-20T01:25:57+03:00 Fatima Jebari jebari_fatima@wheatoncollege.edu Obed Izaguirre-Lozano journals@carijournals.org Sudha Krishnaswami journals@carijournals.org Matthew M. Lutey journals@carijournals.org

<p><strong>Purpose</strong>: The purpose of this paper is to disentangle a unique way in which corporate social responsibility (CSR) affects firm value in the context of product recalls in the automotive industry.</p> <p><strong>Methodology</strong>: Using a sample of product recall events in the automotive industry between 2002 and 2018 and controlling for the spread of product recalls across product lines, this study explores the underlying economic channels through which CSR improves investments in quality. For robustness check, self-selection bias is corrected for using a 2SLS approach and alternative measures for product failures and CSR.</p> <p><strong>Findings:</strong> The authors find that firms with higher CSR scores are associated with a lower frequency of recalls. Moreover, higher CSR scores are associated with a higher likelihood of voluntary recalls, higher product quality, higher capital expenditures, and higher employee productivity.</p> <p><strong>Unique Contribution to Theory, Practice, and Policy:</strong> This study offers insights to managers, investors, and board members, showing the potential benefits of engaging in CSR activities. This study contributes to the literature on the effect of CSR on different managerial decisions and the factors that affect product recalls. Additionally, the study reveals the connection between CSR and product recalls.</p>

2024-03-20T00:00:00+03:00 Copyright (c) 2024 Dr. Fatima Jebari, Dr. Obed Izaguirre-Lozano, Dr. Sudha Krishnaswami, Dr. Matthew M. Lutey