Corporate Social Capital and Firm Performance

The confluence of a number of marketplace phenomena has provided the impetus for this research. The first is the so called value relevance of intangibles in determining share market performance. A second related phenomenon is the increasing reliance on share price appreciation as the principal means for shareholder return, as opposed to returns through dividends. A third phenomenon is the rapid growth in marketplace alliances and joint ventures, the number of which has grown rapidly over the past 30 years. The explanation for these phenomena may lie in the concept of corporate social capital(CSC). This research explores the linkages between CSC and firm performance. The experimental context used was the global information technology services sector. The research proposes a model for CSC comprised of multiple elements. Empirical research is then conducted to identify those elements having the greatest impact on firm performance. The critical elements identified were human capital, financial soundness and market connectivity. However their relative impact is dependent on the specific business context within which it is employed.