Doenvironmental, social and governance (ESG)related compensation and long-term compensation positively influencecorporate social performance (CSP)?

This study examines the effect of long-term and environmental, social and governance (ESG) related compensationon corporate social performance(CSP) between the period 2009 and 2017. Furthermore, this thesis studieswhether the amount of firm’s ESG news with a positive sentiment strengthensthis positive relationshipand whether ESG news of the firm with a negative sentiment weakens this positive relationship for S&P 500 firms between the period 2015 and 2017.The study showthat the CSP score improves over time and the last couple of years more companies are including ESG related compensation into their remuneration schemes. The results of the multiple ordinary least squares (OLS) regression models provideempirical evidence that long-term compensation and ESG related compensation positively influences CSP. Furthermore, the resultsof the regressionswhere the effect of firm’s ESG news is incorporated, showthat positive ESG news weakens the positive effectoflong-term and ESG related compensation onCSP. No significant effect is found for ESG news with a negative sentiment on the positive relationshipof long-term and ESG related compensation on CSP.