Title: Financial analysis of companies concerned about human rights

Authors: Katherine Taken Smith; Teresa K. Betts; L. Murphy Smith

Addresses: Department of Management and Marketing, Murray State University, 451 Business Building, Murray, KY 42071, USA ' Department of Management and Marketing, Murray State University, 451 Business Building, Murray, KY 42071, USA ' Department of Accounting, Murray State University, 132 Business Building, Murray, Kentucky, 42071, USA

Abstract: Consumer demand for low prices juxtaposing with a company's need for profitability drives corporations to minimise the costs of goods within their supply chains. This has led some unethical business managers to engage in human exploitation within company supply chains. However, consumers also demand that human rights are not violated in the making of the goods they buy. Thus, corporations are being held accountable for monitoring human rights within their supply chains. The purpose of this paper is to examine the financial performance of Fortune 500 companies that have shown concern over human rights within their supply chains. Since there is a financial cost in safeguarding human rights within supply chains, this paper seeks to determine if companies concerned about human rights suffer financial loss. The 92 concerned companies in the sample, compared to the average company in top industries, were found to have some significantly different financial performance ratios.

Keywords: corporate social responsibility; CSR; supply chain; supply chain audit; human rights; human trafficking; human exploitation; work place violations; social audit; corporate finances; strategic management.

DOI: 10.1504/IJBEX.2018.089797

International Journal of Business Excellence, 2018 Vol.14 No.3, pp.360 - 379

Received: 11 Aug 2016
Accepted: 03 Dec 2016
Published online: 12 Feb 2018 *

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