The Control–Ownership Wedge and Corporate Social Responsibility

We examine the effect of the control–ownership wedge (the difference between voting rights and cash flow rights) in Korean business groups (Chaebols) on corporate social responsibility activities. The results of our analyses show that on corporate social responsibility activities decrease as the control–ownership wedge increases. This result remains consistent when on corporate social responsibility scores are used. This study provides evidence that a greater control–ownership wedge decreases engagement in corporate social responsibility activities in the context of Korean business groups (Chaebols), with their unique ownership structure.