The role of slack resources in explaining the relationship between corporate social responsibility disclosure and firm market value: a case from an emerging market

The purpose of this study is to investigate the moderating effect of slack resources (namely, profitability and cash holdings) on the relationship between corporate social responsibility disclosure (CSRD) and firm market value. The authors test the hypothesis through performing panel data analysis for a sample of 95 non-financial Jordanian firms listed on the Amman Stock Exchange from the period 2011 to 2016. Content analysis was employed to evaluate the level of CSRD based on an index of 42 items and four themes. While the findings show no significant relationship between CSRD and firm market value, higher slack resources were found to positively moderate this relationship. The outcomes therefore suggest that slack resources accentuate the effect of CSRD on firm market value. The use of Jordanian firms is distinctive and provides valuable insight into contexts in which the market tends to place less weight on a firm's CSR activities.