Valuation implications of socially responsible tax avoidance: Evidence from the electricity industry

Journal of Accounting and Public Policy - Tập 41 - Trang 106959 - 2022
Kerry Inger1, James Stekelberg2
1Harbert College of Business, Auburn University, 345 Lowder Hall, Auburn, AL 36830, USA
2College of Business, Colorado State University, Rockwell Hall Room 256, Fort Collins, CO 80523, USA

Tài liệu tham khảo

Austin, 2017, An examination of reputational costs and tax avoidance: Evidence from firms with valuable consumer brands, J. Am. Taxation Association, 39, 67, 10.2308/atax-51634 Bartov, 2021, Corporate social responsibility and the market reaction to negative events: Evidence from inadvertent and fraudulent restatement announcements, Accounting Review, 96, 81, 10.2308/tar-2018-0281 Baudot, 2020, Is corporate tax aggressiveness a reputation threat? Corporate accountability, corporate social responsibility, and corporate tax behavior, J. Bus. Ethics, 163, 197, 10.1007/s10551-019-04227-3 Bryant-Kutcher, 2012, How do cross-country differences in corporate tax rates affect firm value?, J. Am. Taxation Association, 34, 1, 10.2308/atax-10207 Business Roundtable. 2019. Business Roundtable redefines the purpose of a corporation to promote an economy that serves all Americans. Press release (August 19). Available at: https://www.businessroundtable.org/business-roundtable-redefines-the-purpose-of-a- corporation-to-promote-an-economy-that-serves-all-americans. Cameron, 2013 Chen, 2019, Media coverage of corporate taxes, The Accounting Review, 94, 83, 10.2308/accr-52342 Clarkson, 2012, 11 Col, 2019, Going to haven? Corporate social responsibility and tax avoidance, J. Bus. Ethics, 154, 1033, 10.1007/s10551-016-3393-2 Cooper, 2018, Halo effect of fallen angel effect? Firm value consequences of greenhouse gas emissions and reputation for corporate social responsibility, J. Account. Public Policy, 37, 226, 10.1016/j.jaccpubpol.2018.04.003 Dahlsrud, 2008, How corporate social responsibility is defined: An analysis of 37 definitions, Corp. Soc. Responsib. Environ. Manag., 15, 1, 10.1002/csr.132 Davis, 2016, Do socially responsible firms pay more taxes?, Accounting Review, 91, 47, 10.2308/accr-51224 Davis, A.B., R.D. Moore, and T. Rupert. 2020. Corporate duty to pay and tax management: An experimental investigation of the impact on willingness to invest. Working paper. Desai, 2009, Corporate tax avoidance and firm value, Rev. Economics Statistics, 91, 537, 10.1162/rest.91.3.537 Dhaliwal, D., T. Goodman, P. Hoffman, and C. Schwab. 2021. The incidence, valuation, and management of tax-related reputational costs: Evidence from a period of protest. Journal of the American Taxation Association, Forthcoming. Dögl, 2014, Corporate environmental responsibility, employer reputation and employee commitment: An empirical study in developed and emerging economies, Int. J. Human Resource Management, 25, 1739, 10.1080/09585192.2013.859164 Drake, 2019, Does tax risk affect investor valuation of tax avoidance?, J. Accounting, Auditing Finance, 34, 151, 10.1177/0148558X17692674 Du, 2013, The roles of leadership styles in corporate social responsibility, J. Bus. Ethics, 114, 155, 10.1007/s10551-012-1333-3 Dyreng, 2016, Public pressure and corporate tax behavior, J. Accounting Research, 54, 147, 10.1111/1475-679X.12101 Environmental Protection Agency (EPA), 2019, Inventory of U.S. greenhouse gas emissions and sinks, Available at Ernst & Young. 2016. A new mountain to climb: tax reputation risk, growing transparency demands and the importance of data readiness. Available at (Last accessed 3/2021): https://www.ey.com/Publication/vwLUAssets/ey-managing-tax-transparency-and- reputation-risk/$FILE/ey-managing-tax-transparency-and-reputation-risk.pdf Flammer, 2013, Corporate social responsibility and shareholder reaction: The environmental awareness of investors, Acad. Manag. J., 56, 758, 10.5465/amj.2011.0744 Fombrun, 2000, Opportunity platforms and safety nets: Corporate citizenship and reputational risk, Bus. Soc. Rev., 105, 85, 10.1111/0045-3609.00066 Frazier, 2019, Wind and solar PV deployment after tax credits expire: A view from the standard scenarios and the annual energy outlook, Electricity J., 32, 106637, 10.1016/j.tej.2019.106637 Freeman, 2010 Freeman, 2004, Stakeholder theory and “the corporate objective revisited”, Organ. Sci., 15, 364, 10.1287/orsc.1040.0066 Friedman, M. 1970. The social responsibility of a business is to increase its profits. New York Times Magazine, September 13: 32-33, 122-124. Gallemore, 2014, The reputational costs of tax avoidance, Contemporary Accounting Res., 31, 1103, 10.1111/1911-3846.12055 Ge, 2015, Corporate social responsibility and the cost of corporate bonds, J. Account. Public Policy, 34, 597, 10.1016/j.jaccpubpol.2015.05.008 Godfrey, 2005, The relationship between corporate philanthropy and shareholder wealth: A risk management perspective, Acad. Manag. Rev., 30, 777, 10.5465/amr.2005.18378878 Godfrey, 2009, The relationship between corporate social responsibility and shareholder value: An empirical test of the risk management hypothesis, Strateg. Manag. J., 30, 425, 10.1002/smj.750 Graham, 2014, Incentives for tax planning and avoidance: Evidence from the field, The Accounting Review, 89, 991, 10.2308/accr-50678 Griffin, 2017, The relevance to investors of greenhouse gas emission disclosures, Contemporary Accounting Research, 34, 1265, 10.1111/1911-3846.12298 Hanlon, 2010, A review of tax research, J. Accounting Economics, 50, 127, 10.1016/j.jacceco.2010.09.002 Hanlon, 2009, What does tax aggressiveness signal? Evidence from stock price reactions to news about tax shelter involvement, J. Public Economics, 93, 126, 10.1016/j.jpubeco.2008.09.004 Hardeck, 2019, Consumer reactions to tax avoidance: Evidence from the United States and Germany, J. Bus. Ethics, forthcoming. Hardeck, 2014, Consumer reactions to corporate tax strategies: Effects on corporate reputation and purchasing behavior, J. Bus. Ethics, 123, 309, 10.1007/s10551-013-1843-7 Hardeck, 2020, Do the Bad Guys Report? Examining whether CSR Performance Influences the Use of Socially Responsible Tax Disclosures, Working paper. Hayn, 1995, The information content of losses, J. Accounting Economics, 20, 125, 10.1016/0165-4101(95)00397-2 Heckman, 1979, Sample selection bias as a specification error, Econometrica, 47, 153, 10.2307/1912352 Hoi, 2013, Is corporate social responsibility (CSR) associated with tax avoidance? Evidence from irresponsible CSR activities, Accounting Review, 88, 2025, 10.2308/accr-50544 Hong, H.G., J.D. Kubik, I. Liskovich, and J. Scheinkman. 2019. Crime, punishment and the value of corporate social responsibility. Working paper. Huang, 2017, Are socially responsible firms less likely to expatriate? An examination of corporate inversions, J. Am. Taxation Association, 39, 43, 10.2308/atax-51790 Huang, 2015, Corporate social responsibility research in accounting, J. Accounting Literature, 34, 1, 10.1016/j.acclit.2015.03.001 Inger, 2014, Relative valuation of alternative methods of tax avoidance, J. Am. Taxation Association, 36, 27, 10.2308/atax-50606 Inger, 2019, Market valuation consequences of avoiding taxes while also being socially responsible, J. Management Accounting Research, 31, 75, 10.2308/jmar-52169 Jain, 2016, Value-relevance of corporate social responsibility: Evidence from short selling, J. Management Accounting Research, 28, 29, 10.2308/jmar-51439 Jensen, 1976, Theory of the firm: managerial behavior, agency costs and ownership structure, J. Financ. Econ., 3, 305, 10.1016/0304-405X(76)90026-X Joint Committee on Taxation (JCT), Estimates of Federal Tax Expenditures for Fiscal Years 2018-2022 (JCX-81-18), October 4, 2018. Joint Committee on Taxation (JCT), General Explanation of Tax Legislation Enacted in the 112th Congress (JCS–2–13), February 2013. Joint Committee on Taxation (JCT), General Explanation of Tax Legislation Enacted in the 106th Congress (JCS–2– 01), April 19, 2001. Karpoff, 2011, Does reputation work to discipline corporate misconduct? Kempa, 2021, The cost of debt of renewable and non- renewable energy firms, Nat. Energy, 6, 135, 10.1038/s41560-020-00745-x Khojastehpour, 2014, The effect of environmental CSR issues on corporate/brand reputation and corporate profitability, European Business Review, 26, 330, 10.1108/EBR-03-2014-0029 Lanis, 2018, Outside directors, corporate social responsibility performance, and corporate tax aggressiveness: An empirical analysis, J. Accounting, Auditing & Finance, 33, 228, 10.1177/0148558X16654834 Lanis, 2015, Is corporate social responsibility performance associated with tax avoidance?, J. Bus. Ethics, 127, 439, 10.1007/s10551-014-2052-8 Lanis, 2012, Corporate social responsibility and tax aggressiveness: An empirical analysis, J. Account. Public Policy, 31, 86, 10.1016/j.jaccpubpol.2011.10.006 Lee, 2021, The effects of tax avoidance news on employee perceptions of managers and firms: Evidence from Glassdoor.com ratings, Accounting Review, 96, 343, 10.2308/TAR-2019-0148 Lins, 2017, Social capital, trust, and firm performance: The value of corporate social responsibility during the financial crisis, J. Finance, 72, 1785, 10.1111/jofi.12505 Liu, 2011, Self-dealing regulations, ownership wedge, and corporate valuation: International evidence, Corporate Governance: An Int. Rev., 19, 99, 10.1111/j.1467-8683.2010.00839.x Malik, 2015, Value-enhancing capabilities of CSR: A brief review of contemporary literature, J. Bus. Ethics, 127, 419, 10.1007/s10551-014-2051-9 Matsumura, 2014, Firm-value effects of carbon emissions and carbon disclosures, Accounting Review, 89, 695, 10.2308/accr-50629 Margolis, 2009, Does it pay to be good… and does it matter? A meta-analysis of the relationship between corporate social and financial performance, Ann Arbor, 1001, 48109 Mayberry, 2021, Is corporate social responsibility related to corporate tax avoidance? Evidence from a natural experiment, J. Am. Taxation Association, 43, 79, 10.2308/JATA-19-021 McWilliams, 2001, Corporate social responsibility: A theory of the firm perspective, Acad. Manag. Rev., 26, 117, 10.2307/259398 Metcalf, 2010, Investment in energy infrastructure and the tax code, Tax Policy Economy, 24, 1, 10.1086/649826 Myers, 1977, Determinants of corporate borrowing, J. Financ. Econ., 5, 147, 10.1016/0304-405X(77)90015-0 Petersen, 2009, Estimating standard errors in finance panel data sets: Comparing approaches, Rev. Financial Studies, 22, 435, 10.1093/rfs/hhn053 Preuss, 2017, Corporate tax payments and corporate social responsibility: complements or substitutes? Empirical evidence from Europe, Business Economics J., 326, 1 PwC. 2013. Tax strategy and corporate reputation: a business issue. Available at: https://www.pwc.com/gx/en/tax/publications/assets/pwc-tax-strategy-and-corporate- reputation-a-tax-issue-a-business-issue.pdf Scholes, 2015 Sherlock, 2018, The renewable electricity production tax credit: In brief (updated), Current Politics Economics United States, Canada Mexico, 20, 611 Stokes, 2018, Politics in the US energy transition: Case studies of solar, wind, biofuels, and electric vehicles policy, Energy Policy, 113, 76, 10.1016/j.enpol.2017.10.057 Walls, 2012, Corporate governance and environmental performance: is there really a link?, Strateg. Manag. J., 33, 885, 10.1002/smj.1952 Watson, 2015, Corporate social responsibility, tax avoidance, and earnings performance, J. Am. Taxation Association, 37, 1, 10.2308/atax-51022 Wilson, 2009, An examination of corporate tax shelter participants, Accounting Review, 84, 969, 10.2308/accr.2009.84.3.969