The level of compliance with the international code of marketing of breast-milk substitutes: does it matter to stock markets?

Hoepner, A.G.F., de Aguiar, T.R.S. and Majithia, R. (2014) The level of compliance with the international code of marketing of breast-milk substitutes: does it matter to stock markets? Journal of Business Ethics, 119(3), pp. 329-348. (doi: 10.1007/s10551-013-1625-2)

Abstract

The present paper explores, theoretically, and empirically, whether compliance with the International Code of marketing of breast-milk substitutes impacts on financial performance measured by stock markets. The empirical analysis, which considers a 20-year period, shows that stock markets are indifferent to the level of compliance by manufacturers with the International Code. Two important issues emerge from this result. Based on our finding that financial performance as measured by stock markets cannot explain the level of compliance, the first issue refers to what alternative types of mechanisms drive manufacturers who comply the least with voluntary codes such as the International Code. Conversely, from our finding that stock markets do not reward the most compliant, the second issue raised is an inherent weakness of stock markets to fully incorporate social and environmental values.

• Item Type: Articles
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Sales de Aguiar, Dr Thereza Raquel
• Authors: Hoepner, A.G.F., de Aguiar, T.R.S., and Majithia, R.
• College/School: College of Social Sciences > Adam Smith Business School > Accounting and Finance
• Journal Name: Journal of Business Ethics
• Publisher: Springer
• ISSN: 0167-4544
• ISSN (Online): 1573-0697