The Effects of Corporate Governance on Credit Ratings: The Role of Corporate Social Responsibility

摘要

This study examines the effects of corporate governance and corporate social responsibility (CSR) on credit ratings for firms in Taiwan. We examine this causal relationship using ordered logit regressions with two-stage least-squares estimates. We document that CSR performance demonstrates both moderation and partial mediation effects in the relationship between corporate governance and credit rating. Our results indicate that a firm should practice good corporate governance and engage in CSR activities to improve its credit rating. This study further shows that family firms with strong corporate governance and good CSR performance do not benefit from higher credit ratings. However, large firms with good corporate governance practices benefit from higher credit ratings.