The Effectiveness of Existing Legislation in preventing Unethical Corporate Behavior by EU Firms
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2024-07-09
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en
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The aim of my study is to investigate whether the NFRD and BEPS Action 13 have made EU corporations behave ethically better. As this research is written from a stakeholder perspective, it is believed that firms should keep society and the planet into consideration when operating. Hereby, CSR performance and corporate tax avoidance are seen as two important matters. The first one is divided into an environment pillar score and a social pillar score (granted by LSEG Workspace). The latter is measured by means of the variable ETR. Graphical presentations and (static) time series regression analyses were used to check the hypotheses that are central. For starters, the results do not provide proof for the existence of a positive connection between the NFRD and CSR performance. Also, the assumption that CbC reporting negatively impacts corporate tax avoidance is not supported either. In fact, it is even determined that CbC reporting and corporate tax avoidance are positively linked at a 5% significance level. Additionally, inconsistent with my expectation, (semi-)strong evidence is found for ETR to be negatively influenced by Environment_Pillar_Score and Social_Pillar_Score.
Overall, my master’s thesis suggests that existing legislation is not effective in preventing unethical corporate behavior by EU firms.
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Faculteit der Managementwetenschappen