CSR and tax avoidance negatively interact to affect firm value

What’s Okay: Participating in CSR or tax avoidance

What’s NOT Okay: Participating in both CSR programs and tax avoidance:

• conveys inconsistency between reputation building CSR and tax avoidance
• concerns investors that funds from tax avoidance are not used toward investments that generate a return

Key Takeaway: Investors place less value on firms playing Robin Hood by taking from the government via avoided taxes in order to distribute funds to society via corporate philanthropic giving.

CFO DIVE |  Investors Punish Companies that Combine Philanthropy & Tax Avoidance