Ineffectively Taxed, Socially Responsible?

• In Event: 3522 - Section on Economic Sociology Refereed Roundtable Session
  In Refereed Roundtable 100min: Table 03. Firms and States

Abstract

Contemporary organizational scholarship highlights the tension between the profit motive of corporate entities and social pressure to conform to norms of corporate social responsibility. One place where the tension between social responsibility and profitability seems especially straightforward concerns taxes. Do socially responsible firms pay their taxes? Does good corporate citizenship include the obligation to support public finances? Since taxes fund public policy, and since public policy provides public goods to society, can a socially responsible firm also pursue aggressive tax avoidance strategies or even outright tax evasion? If one considers the particular issues that constitute CSR, they usually emphasize labor and the environment. Rarely do the firms that embrace CSR or the activists that advocate for CSR discuss the issue of corporate taxes. Using new data on measures of corporate social responsibility along with standard firm-level and financial controls, this project attempts to answer how CSR and tax avoidance are or are not related.

Authors

• Bruce G. Carruthers, Northwestern University

• Brayden G. King, Northwestern University

• Andrew Lowell Owen, Northwestern University