Resumo

There is a predominance in literature that advocates that firm's interest in undertaking CSR, which includes its assessment by CSR indexes, reflects the firm's good corporate conduct and commitment to avoid actions that negatively impact its corporate image, given that, these indexes have an aggregate impact on movement in favor of CSR, since they create constant pressure to recognize and legitimize best practices that promote firm's CSR performance. In this sense, it is expected that firms that are better evaluated in CSR indexes are less involved in environmental, social and governance (ESG)

Taking into account growing global importance of CSR indexes, ratings and rankings, as well as growing concern by stakeholders about business actions that may adversely affect the firm image, based on Legitimacy and Stakeholder theories, as well as on the emerging theoretical approach “window dressing”, this study shows this question: What is the degree of involvement in environmental, social and governance (ESG) controversies of Brazilian firms evaluated by CSR indexes? This work aims to investigate the degree of involvement in ESG controversies of Brazilian firms evaluated by CSR indexes.

A firm can incorporate CSR as a strategy to compensate for its socially irresponsible actions. CSR would be justified as a solution to problems associated with social costs. In this sense, firm opportunistic behavior can arise, known as “window dressing” aproach, that making CSR initiatives less effective, allowing legitimating “questionable” business and “deceiving” stakeholders to firm's true commitment to CSR. However, this would be avoided through CSR indexes, since these would give firms more legitimacy, signaling good reputation and offering stakeholders more consistent CSR information.

The study sample consists of 1,007 observations in period 2013-2017 referring to 275 Brazilian firms evaluated by such CSR indexes: Corporate Sustainability Index, Merco Corporate Reputation Firms, Merco Responsibility and Corporate Governance and ratings from CSRHub and Thomson Reuters. Firm's evaluation by CSR indexes takes into account firm scores obtained in these indexes. ESG controversies are obtained through reports by SITAWI agency. Such statistical procedures have been processed: descriptive analysis, data normalization technique, correlation analysis and mean comparison tests.

The findings, contrary to expectations, denote to exist a high degree of involvement of Brasilian firms evaluated by CSR indexes in ESG controversies. Confirming this trend, the mean comparison tests revealed that, contrary to what was expected by study hypothesis, firms that are better evaluated by CSR indexes are more involved in ESG controversies, which demonstrates a socially irresponsible conduct of such firms, in accordance with “window dressing” approach.

These findings, based on confrontation between CSR indexes assessment and ESG controversies, in accordance with “window dressing” approach, contrast with argument that CSR indexes give firms more legitimacy in terms of their responsible and committed stance on issues related to sustainable development, suggesting that firms may not be as responsible as is publicly claimed in assessment provided by CSR indexes, which indicates that firms only seek to comply with the criteria required by indexes that assess their CSR performance externally, but do not make significant changes in their operations

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