I saw in a recent Harvard Business Review mention of an article in the Academy of Management Journal noting that “Hedge funds see high levels of CSR activity as a signal that a firm is wasteful and ripe for cost-cutting.” The researchers found that in a sample of 16,000 firms, the higher a firm’s CSR score, the more likely it would be targeted by an activist hedge fund.
For firms targeted, on average, 25% reduce CSR spending after the attack on their business model by some owners.
The article concluded that firms with CSR commitments need to find investors with similar values – the love of something other than ready money.