CSR as Signal in M&A Transactions

A recent corporate finance study highlights CSR’s strategic role in mergers and acquisitions. Beyond compliance, CSR acts as a performance signal to potential acquirers. Firms boosting CSR efforts pre-acquisition often secure higher takeover premiums. The data suggests CSR signals strong governance, stakeholder trust, and reduced integration risk. Acquirers view visible CSR as a proxy for operational resilience and reputational strength. This reframes CSR from a soft-value initiative to a tangible asset in deal-making. The findings encourage firms to align CSR with strategic timing in M&A scenarios.