Corporate Social Responsibility and Demand for New Equity Issues

Consistent with the hypothesis that equity demand is negatively (positively) affected by CSR concerns (strengths) of the issuer, we find that (1) issuers with greater CSR concerns are more likely to revise downwards the terms (offer price, number of shares offered, and total proceeds raised) of their stock offerings; (2) the probability of the over-allotment option being exercised is negatively related to CSR concerns in SEO issues, but is positively related to CSR strengths in IPO issues; and (3) the change in the percentage of institutional holdings around the issue date is positively (negatively) related to CSR strengths (concerns).