Relationship among CSR Initiatives and Financial and Non-Financial Corporate Performance in the Ecuadorian Banking Environment

Round 1

Reviewer 1 Report

attached

Comments for author File: Comments.pdf

Author Response

Reply to Reviewer 1 Comments

 

All suggested comments are reflected as follows:

 

1. What insights can you provide based on your finding? Do they push forward our understanding?

=> The insights for research are provided in section 5 conclusion (see p. 14)

 

2. 
   What should we do with your research?

=> Our proposal for the Ecuadorian banking industry is provided in section 5 conclusion (see pp. 14-15)

 

3. Do you have any suggestions to improve the current regulation or practice?

=> The regulatory and practical suggestions are provided in section 5 conclusion (see p. 15)

 

4. Adding the above discussion and extend your literature review may help you make more contributions and position your contributions better.

=> Extension of references is provided in sections 1 introduction (see p. 2), 2.1 CSR (see p. 3), and 3 research model (see p. 8)

 

5. The paper seems to claim causality but does not discuss the potential endogeneity issue and its remedies sufficiently. See Li 2016, Endogeneity in CEO power: A survey and experiment, Investment Analysts Journal, 45 (3): 149-162 for a summary of methods to deal with the endogeneity problem. No need to use all these methods but at least discuss them in your scenario.

=> The potential endogeneity problem and Li (2016)’s methodology are provided in section 3 research model (see p. 8)

 

6. Additionally, you should refer to more recent development in this area of the effects of CSR. CSR may affect risk taking incentives such as in Dunbar, Li and Shi. 2019. Corporate Social Responsibility and CEO Risk-Taking Incentives. Journal of Corporate Finance forthcoming.

=> Dunbar et al. (2019)’s results are included in section 2.1 CSR (see p. 3)

 

7. New literature on how CSR affect financial performance like Li, Minor, Wang and Yu. 2019. A Learning Curve of the Market: Chasing Alpha of Socially Responsible Firms. Journal of Economic Dynamics and Control forthcoming. You need to discuss those aspects of possible channels to give readers a more comprehensive view and a richer story and/or point out future research direction from these perspectives.

=> Li et al. (2019)’s implications are included in section 1 introduction (see p. 2)

 

8. Generally, the quality of writing is not satisfactory; there are many typos and grammatical mistakes throughout the paper, making it hard to read and understand. For example, “if we analyze…, we found….” Try to use the present tense throughout the paper consistently. Try to avoid long sentences and vague words. Use short, precise, and concise sentences and be more straightforward. The last section conclusion should summarize all your findings, their implications to researchers and practitioners, future direction for research, limitation of the current study, etc.

=> Typos and grammatical mistakes are all corrected. Double checked all others.   

=> The summary of all findings, implications, future research suggestions, and limitation of our study are provided in section 5 conclusion (see pp. 14-15)

 

9. You need to seriously proofread the paper and extend and update your references.

=> Proofreading is executed.

=> Extension of references is provided in sections 1 introduction (see p. 2), 2.1 CSR (see p. 3), and 3 research model (see p. 8)

 

 

Author Response File: Author Response.docx

Reviewer 2 Report

This is highly relevant, concise and multi-disciplinary manuscript well connecting 3 sustainability pillars, 4 responsibility iniciative types and other CSR aspects with both financial and non-financial performance indicators. It needs to be underlined that the introduction and the indication of principal ideas and approaches is done in straight manner, hypotheses are well set and even well later on adjusted (reduction of some elements). I do not have any objections regarding the measurement of financial performance, but I do have some concerns regarding the assessement of economic, legal, ethical and philantrophic responsibilities as well as the assessment of non-financial performance values resulting from these CSR iniciatives, i.e. customer´s brand trust, loyalty, quality perception and satisfaction. First the entire mechanism should be better described and explained, secondly the selection of the sample should be justified (why eactaly these 228 respondents and thirdly a deeper analysis in this respect needs to be developed. For example, where these respondents customers of thes banks and how was their financial situation (income), etc? Finally, it seems that you move to fast to conclusions and even to international and cross-jurisdictional comparison. You have enough good ideas and information and still space to expand your narratives. You have bright ideas and good data, so please take advantage of that and expand your description, argumentative and analytical part and definetely improve your conclusions.

Author Response

Reply to Reviewer 2 Comments

 

All suggested comments are reflected as follows:

 

1. I do have some concerns regarding the assessment of economic, legal, ethical and philanthropic responsibilities as well as the assessment of non-financial performance values resulting from these CSR initiatives, i.e. customer´s brand trust, loyalty, quality perception and satisfaction. First the entire mechanism should be better described and explained.

=> Detailed methodology is provided in section 3.1 measurement of constructs (see p. 6) and Table 1 scale items for constructs (see pp. 6-8)

 

2. Secondly the selection of the sample should be justified (why exactly these 228 respondents).

=> Sample selection is provided in section 4.2 CSR and non-financial performance (see p. 10)

 

3. Thirdly a deeper analysis in this respect needs to be developed. For example, where these respondents’ customers of these banks and how was their financial situation (income), etc?

=> Respondents’ demographic information is provided in section 4.2.1 demographic analysis (see p. 10)

 

4. Finally, it seems that you move to fast to conclusions and even to international and cross-jurisdictional comparison. You have enough good ideas and information and still space to expand your narratives. You have bright ideas and good data, so please take advantage of that and expand your description, argumentative and analytical part and definitely improve your conclusions.

=> Extension of references is provided in sections 1 introduction (see p. 2), 2.1 CSR (see p. 3), and 3 research model (see p. 8). The consistency of our findings with previous studies’ results for cross-jurisdictional comparison is provided in the abstract (see p. 1) and section 5 conclusion (see pp. 14-15)

Author Response File: Author Response.docx

Round 2

Reviewer 1 Report

well done