An International Meeting of the American Accounting Association American Accounting Association 2006 Annual Meeting August 6–9, 2006 Washington, D.C.

Rasoul H. Tondkar
Virginia Commonwealth University

Joyce Van Der Laan Smith
Virginia State University

Robert L. Andrews
Virginia Commonwealth University

Abstract: This paper examines the impact of CSD on investment behavior in the countries of the U.S., Japan, France, and Sweden. We use the stakeholder concept as the theoretical framework for our analysis. Specifically, we examine whether individuals in a society that emphasizes stakeholder capitalism will place more importance on CSD in their investment decisions than individuals in a society that emphasizes shareholder capitalism.

Through a cross-country experiment we found that there was a significant (p<.01), systematic difference in investors’ reactions to CSD across countries. To determine if this difference could be predicted using the stakeholder concept we developed a stakeholder scale. Analysis revealed that the stakeholder scale score was significantly (p<.01) related to the participant’s reactions to CSD in the U.S. and Sweden. These findings provide significant insight into the cross-country differences in the perceived relevance of CSD to investors.

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