Lucknow, Jan. 5 -- The legally mandated Corporate Social Responsibility (CSR) spending by companies in India may increase perceived risk among investors, directly impacting companies' ability to raise capital from the stock market at a higher cost.
This was revealed in a study conducted by the Indian Institute of Management Lucknow (IIM Lucknow) recently. The study specifically focused on CSR spending related to poverty alleviation.
The research found that when companies spend on CSR under compulsion, investors perceive it as an additional burden rather than a benefit to the company. This leads to a decrease in investor confidence and a demand for higher returns.
The research has been published in the international journal, Journal of Ac...