Economic policy uncertainty and corporate social responsibility performance: evidence from China

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Tianjiao Zhao ◽  
Xiang Xiao ◽  
Bingshi Zhang
Keyword(s):  
Economic Policy ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Inhibitory Effect ◽  
Policy Uncertainty ◽  
Content Type ◽  
Economic Policy Uncertainty ◽  
Corporate Social ◽  
The Relationship ◽  
Csr Engagement

Purpose The purpose of this paper is to show how the external issue of economic policy uncertainty (EPU) affects enterprises’ corporate social responsibility (CSR). Design/methodology/approach This study investigates the relationship between EPU and CSR based on the Chinese capital market from 2010 to 2018. Following the most recent studies focused on economic policy uncertainty, this paper uses the news-based method proposed by Baker et al. (2016) to measure EPU and explore the effect of EPU on CSR, as well as the mediating role of state ownership in such a relationship. Findings Empirical results show that increasing EPU will restrain enterprises’ social responsibility behaviour and the inhibitory effect is more obvious for state-owned enterprises. Further analyses reveal that the inhibitory effect of EPU on CSR is stronger for enterprises that face severe financial constraints and is significant for various components of CSR, and trade policy uncertainty could also curb enterprises’ social responsibility behaviour. Practical implications As a stable economic environment is important for enterprises’ CSR engagement, the present study’s conclusions can help policymakers better understand the implications of policy stability for enterprises’ financial and non-financial decisions and especially their CSR decisions. Social implications With the increasing attention paid to the CSR of enterprises, this study provides evidence that enterprises should develop appropriate CSR strategies according to the economic policy environment and enhance their capacity to withstand the risks generated by EPU. Originality/value To the best of the author’s knowledge, this study is the first to analyse the relationship between EPU and CSR. The results contribute to a better understanding of what issues influence enterprises’ CSR engagement, highlighting the importance of a stable economic policy environment and of enterprises’ ability to withstand risks.

scholarly journals Corporate Social Responsibility Engagement, Economic Policy Uncertainty, and Firm Financial Performance

1970 ◽  
Vol 37 (2) ◽  
pp. 1-21
Author(s):  
Bruce Walters ◽  
Sammy Muriithi ◽  
Otis Gilley
Keyword(s):  
Economic Policy ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Policy Uncertainty ◽  
Strategic Decisions ◽  
Economic Policy Uncertainty ◽  
Firm Financial Performance ◽  
Corporate Social ◽  
The Relationship ◽  
Csr Engagement

The link between corporate social responsibility (CSR) engagement and firmfinancial performance has been examined in a variety of contexts. We extend thislink to an understudied but important context for strategic decisions: environmentaluncertainty. We draw on stakeholder theory to investigate the potential moderatinginfluence of an increasingly important measure of environmental uncertainty –economic policy uncertainty (EPU), on the CSR-performance relationship. Paneldata analysis of 484 firms using KLD data and the Compustat/Capital IQ databasereveal that EPU appears to moderate the relationship between CSR and financialperformance. Moreover, supplemental analysis reveals that this moderatedrelationship varies when considering individual components of CSR. Implicationsfor both research and practice are suggested regarding managers’ emphases amongvarious CSR initiatives in times of high policy uncertainty.

scholarly journals The Relationship Between Corporate Social Responsibility and Corporate Financial Performance: A Moderating Effect of Economic Policy Uncertainty

2020 ◽  
Vol 11 (5) ◽  
pp. 304
Author(s):  
Van-Thi Dao ◽  
Manh-Trung Phung ◽  
Hongwei Cheng
Keyword(s):  
Economic Policy ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Corporate Financial Performance ◽  
Policy Uncertainty ◽  
Economic Policy Uncertainty ◽  
Csr Disclosure ◽  
Corporate Social ◽  
The Relationship

Within recent decades, researches on corporate social responsibility (CSR) has been receiving more attention over the world. The existing literature on CSR is very diverse, both in evaluating the performance of CSR activities as well as and the relationship between CSR disclosure and firms’ outcome. This paper extends the literature of the latter case, that is, not only it aims to purely examine the relationship between CSR disclosure activities and corporate financial performance (CFP), but also consider this nexus under economic policy uncertainty (EPU) context. Our primary data is collected from more than 500 listed companies in the Vietnamese stock market from 2013 through 2017, while secondary data (CSR and EPU) are self-calculated under serial criteria. Our results support the hypothesis that the more companies intensively disclose CSR, the higher financial performance (both ROA and Tobin’s Q) they could obtain. More interestingly, we find that while EPU seems to weakly moderate the relationship between CSR disclosure and “internal financial performance” (ROA), it will significantly diminish the effect of CSR toward “external financial performance” (Tobin’s Q). The research shed light on an approach to measure CSR disclosure indexes for the emerging market as in Vietnam. Our findings encourage the firm’s managers to pay more attention to CSR disclosure activities due to the positive benefit that their firm could obtain and suggest policymakers to maintain a stable economic background for a sustainable market.

The impact of ownership structure on corporate social responsibility: the moderating role of financial performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Anissa Dakhli
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Ownership Structure ◽  
Managerial Ownership ◽  
Content Type ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship ◽  
Csr Engagement

Purpose The purpose of this paper is to investigate the relationship between ownership structure and corporate social responsibility (CSR). Specifically, this paper examines the impact of financial performance on the relationship between ownership structure and CSR. Design/methodology/approach This study uses panel data set of 200 French firms listed during 2007–2018 period. The direct and moderating effects were tested by using multiple regression technique. Findings The results indicate that investors have different attitudes toward CSR engagement. While institutional ownership affects positively CSR engagement, managerial ownership shows a negative effect. Findings also show that financial performance accentuates these effects. Research limitations/implications The findings have practical implications that may be useful to regulators and managers interested in enhancing CSR. For regulators, the results advise policymakers to restrict managerial ownership and promote institutional investments to improve CSR. For managers, the results suggest developing more sophisticated intervention mechanisms to deal with conflicting voices that could result from different owners’ attitudes toward CSR. As an extension to this research, further study can examine the impact of audit quality on CSR. Originality/value This study proposes the establishment of dynamic links between ownership structure and CSR around firm financial performance. In addition, it investigates not only the overall CSR ratings but also each of CSR pillars, namely, environmental, social and governance.

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