Journal Articles

Corporate Responsiveness to Community Stakeholders: Effects of Contextual and Organizational Characteristics

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Corporate community responsiveness relates to business activities that are integral parts of a firm’s operations and are designed to benefit the firm through benefiting the local communities. Using data from commercial banks in the United States between 1997 and 2000, the authors measured banks’ corporate community responsiveness by their Community Reinvestment Act (CRA) lending activities and their performance ratings by CRA examiners. The authors developed and tested eight hypotheses on the influence of contextual (community income, minority population, and competition) and organizational (age, profitability, risk, institutional ownership, and mergers and acquisitions) factors on the two measures of corporate community responsiveness. The authors found a negative effect for minority population; a positive effect for banks’ profitability; and partial support for community income, competition, and risk factors. The results show no effects for institutional ownership or mergers and acquisitions. The implications of these results for the instrumental aspect of stakeholder theory are discussed.

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Detail Information

Series Title

Business Society

Call Number

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Publisher

: sage publisher., 2009

Collation

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Language

English

ISBN/ISSN

00076503

Classification

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Content Type

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Media Type

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Carrier Type

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Edition

Vol. 48 no. 3, September 2009.pp. 326-359

Subject(s)

Community stakeholders
Community reinvestment act
Environmental and organizational determinants

Specific Detail Info

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Statement of Responsibility

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