Taxes have
become an issue of corporate social responsibility (CSR), but the role of
taxation is to some extent an ambiguous and controversial issue in the CSR
framework. Similarly, another unclear question is what role investors who are committed
to sustainable and responsible investment (SRI) see taxes as having on their
environmental, social, and governance (ESG) agenda. Corporate taxes have an
inverse relationship with the return of the investors: taxes paid directly
affect what is left on the bottom line, reducing the return of investors.
Furthermore, investors are now more aware of tax-related risks, which can
include different forms of reputation risk. Corporate tax planning may increase
the returns, but those increased returns are riskier. This study focuses
particularly on the relationship between SRI and taxation. We find that tax
matters are considered to be on the ESG agenda, but their role and significance
in the ESG analysis is unclear.