Analysts’ Formerly Dim View of CSR Brightens Over Time

Back in the 1990s, stock analysts tended to produce pessimistic recommendations for companies with high expenditures on corporate social responsibility, but over the subsequent decade-plus, they came to view these firms optimistically, according to Ioannis Ioannou of London Business School and George Serafeim of Harvard Business School. Analysts formerly saw CSR as a detriment to profitability—something whose main purpose was to make executives feel good about themselves—but they came to view CSR as essential to corporate standing and to perceive that it may generate financial value in the long run, the authors say.