| Building upon previous research conducted by Hall & Rieck, Griffin & Mahon, and Roberts & Dowling, this analysis will attempt to determine whether socially responsible corporate behavior, or in this case philanthropy, yields short-term benefits to shareholders in addition to the long-term reputation credit which may accrue to the firm. As suggested by Griffin & Mahon, a single firm analysis will be conducted consisting of individual event studies of ExxonMobil's philanthropic activities and the stock market's immediate responses to them over the period of January 2006 until November of 2008. This model will permit empirical measurement of whether these philanthropic "events" have current value as reflected by fluctuations in share price of ExxonMobil common stock relative to an industry average, the Dow Jones US Oil & Gas Index (DJUSEN). This study hypothesizes that share price will increase as a result of socially responsible behavior, and that its impact may vary based upon certain factors. Stock and industry index values were collected from Yahoo Finance and philanthropy announcements were gathered from BusinessWire's and ExxonMobil's websites.;After careful analysis of a subset of nine philanthropic events, all null hypotheses were rejected. Philanthropic events, unlike movements of the DJUSEN industry index, did not demonstrate a significant impact upon share value. Its results may have policy implications for the tax status of corporate foundations and may influence internal corporate decision-making regarding the types of strategic philanthropy a corporation decides to adopt. |
