scholarly journals Can Environmental Corporate Social Responsibility Reduce Firms’ Idiosyncratic Risk? Evidence From China

2020 ◽  
Vol 8 ◽  
Author(s):  
Xiaoran Kong ◽  
Yuying Pan ◽  
Huaping Sun ◽  
Farhad Taghizadeh-Hesary
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Information Asymmetry ◽  
Internal Control ◽  
Idiosyncratic Risk ◽  
Listed Firms ◽  
External Monitoring ◽  
Corporate Social ◽  
The Impact ◽  
A Share

Environmental corporate social responsibility (ECSR) can be a strategy to increase the transparency of investment information effectively to alleviate information asymmetry. The purpose of this article is to examine the impact of ECSR on firms’ idiosyncratic risk. Using the data of A-share listed firms in China and data of Rankins CSR Ratings by developing econometrics models, this study documents that ECSR can significantly reduce the firms’ idiosyncratic risk. This result perpetuates after a series of robustness checks. Besides, the results of conditional analyses reveal that the effect of ECSR is more pronounced for state-owned firms and firms with weaker external monitoring mechanisms and low internal control. Moreover, further evidence suggests that firms with high ECSR show a greater tendency to disclose more information, which reduces the information asymmetry and offers linkages from ESCR to firms’ idiosyncratic risk.

scholarly journals Corporate Social Responsibility and Financial Performance: A Quantile Regression Approach

2019 ◽  
Vol 11 (13) ◽  
pp. 3717 ◽  
Author(s):  
Nana Liu ◽  
Chuanzhe Liu ◽  
Quan Guo ◽  
Bowen Da ◽  
Linna Guan ◽  
...  
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Quantile Regression ◽  
Information Disclosure ◽  
Financial Constraints ◽  
Listed Firms ◽  
Csr Disclosure ◽  
Corporate Social ◽  
The Impact ◽  
A Share

A prominent claim within the literature is that corporate social responsibility-disclosured firms are fundamentally more resilient to financial shocks, relative to firms that take no corporate social responsibility action. To test this, we examine the impact of corporate social responsibility (CSR) information disclosure on financial constraints (FC). Our sample is composed of A-share publicly listed firms from Shanghai and Shenzhen in China during 2013–2017. We find that CSR disclosure influences negatively financial constraints. The quantile regression results also indicate that the influences would more obvious when a company faces stronger financial constraints. Further, CSR disclosure influences negatively financial constraints in financially opaque firms, and the effect of financial opaque on the relationship strengthens when the company faces great financial constraints. After considering the problems of missing variables and endogenous, changing the level of CSR and FC measurement, using 2SLS and two-step GMM methods, the conclusion is still robust. However, the results should not be generalized, since the sample was based on 434 A-share publicly listed firms for 2013–2017. From the perspective of FC, this study contributes to the literature in the field of CSR and expands the empirical research on the economic consequences of CSR. It also can encourage enterprises to voluntarily disclose social responsibility information and it is of great significance to promote the stable development of the capital market and society.

The impact of corporate social responsibility and internal controls on stakeholders’ view of the firm and financial performance

2017 ◽  
Vol 8 (3) ◽  
pp. 246-280 ◽  
Author(s):  
Orhan Akisik ◽  
Graham Gal
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Internal Control ◽  
Internal Controls ◽  
Third Party ◽  
Global Reporting Initiative ◽  
Content Type ◽  
Corporate Social ◽  
The Impact

Purpose The purpose of this study is to empirically examine whether two major stakeholder groups – customers and employees – consider third party-reviewed corporate social responsibility (CSR) reports and assurance on the quality of internal controls as value determinant in their decisions, and how their decisions influence financial performance through the halo effect of these reports. Design/methodology/approach Using Compustat North America and Global Reporting Initiative data, the authors used first-order autoregressive models over the period from 2006 to 2012. Findings The results indicate that the impacts of customers and employees on financial performance are influenced by third party-reviewed CSR reports and effective internal control. Moreover, it is found that the third party-reviewed CSR reports and effective internal control enable the persistence of financial performance. Social implications The findings have implications for stakeholders in terms of third party-reviewed CSR reports and effective internal control. The findings are important due to the influence that these stakeholders (customers and employees) have on the financial performance of firms and the impact that CSR actions can have on society as a whole. Originality/value To the authors' knowledge, this is the first study that contributes to the literature by demonstrating that information about third party-reviewed CSR reports and internal control reviews may influence the perceptions of firms by two primary stakeholders – customers and employees.

scholarly journals Corporate governance and corporate social responsibility: A study of emerging market listed firms

2021 ◽  
Vol 18 (2) ◽  
pp. 90-105
Author(s):  
Annisa A. Lahjie ◽  
Riccardo Natoli ◽  
Segu Zuhair
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Least Squares ◽  
Emerging Market ◽  
Ordinary Least Squares ◽  
Listed Firms ◽  
Data Limitations ◽  
Corporate Social ◽  
The Impact

The main purpose of this paper is to examine the impact of corporate governance (CG) on corporate social responsibility (CSR) of Indonesian listed firms. Estimations via simultaneous equation models with ordinary least squares (OLS) and two-stage least squares (2SLS) were employed for 84 firms with a total of 924 observations over the period of 2007-2017. The results showed that a lack of CG in monitoring and supervisory mechanisms, as well as a high concentration of managerial ownership, can significantly contribute to low levels of CSR. There are data limitations as a number of firms were omitted due to the application of the CSR criteria utilised in this study. The research has implications for Indonesian listed firms with respect to aligning CSR initiatives to firm objectives. The paper provides recommendations for future research in this area. The paper provides one of the few studies to analyse CG on CSR via a comprehensive measurement of CSR. Further, it adds to the empirical academic literature from a developing country context

scholarly journals Research on the Relationship between Corporate Social Responsibility and Commercial Credit Financing-Empirical Analysis Based on Big Data of Shanghai and Shenzhen A-share Enterprises

2021 ◽  
Vol 251 ◽  
pp. 01045
Author(s):  
Feng Gege
Keyword(s):  
Big Data ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Market Competition ◽  
Negative Relationship ◽  
Credit Financing ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship ◽  
A Share

Based on the big data of Shanghai and Shenzhen stock exchanges A-share listed companies from 2009 to 2019, this paper uses fixed effect model to analyze the impact mechanism of corporate social responsibility on commercial credit financing. The results show that: there is a significant negative relationship between corporate social responsibility and commercial credit financing, and the degree of market competition positively adjusts the relationship between the two. Further research finds that corporate social responsibility will increase cash holdings and then affect commercial credit financing.

scholarly journals Financial Performance Gaps and Corporate Social Responsibility

2019 ◽  
Vol 11 (12) ◽  
pp. 3438 ◽  
Author(s):  
Xinming Deng ◽  
Xianyi Long
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Behavioral Theory ◽  
Future Studies ◽  
Listed Firms ◽  
The Past ◽  
And Performance ◽  
Corporate Social ◽  
The Impact

Based on the behavioral theory of firm and prospect theory, we investigate how corporate social responsibility (CSR) activities will respond to underperformance in past and in future. Using samples of Chinese listed firms from 2011 to 2016, this paper found that CSR increases with the distance by which financial performance in the last year falls below goals and decreases with the distance by which expected financial performance will fall below targets. In addition, the future underperformance will weaken the effect of the past underperformance on CSR. Besides, the value of financial performance in the last year will weaken the impact of underperformance in the last year on CSR and strengthen the impact of underperformance in the next year on CSR. The findings suggest that future studies should take both value of financial performance and performance gaps into consideration to have a better understanding of organizational decisions and behaviors.

scholarly journals An Investigation of the Relationship between Corporate Social Responsibility and Corporate Financial Performance in Egypt: The Mediating Role of Information Asymmetry

2021 ◽  
Vol 28 (1) ◽  
pp. 73
Author(s):  
Nancy Mohamed ◽  
Ahmed Rashed
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Information Asymmetry ◽  
Listed Companies ◽  
Partial Least Square ◽  
Corporate Financial Performance ◽  
Model Assessment ◽  
Corporate Social ◽  
The Impact

The aim of this paper is to investigate the impact of corporate social responsibility (CSR) on corporate financial performance (CFP) through information asymmetry (IA) as a mediator. The study involved the whole sectors in the listed companies on Egx100 excluding Financial sectors (banks and financial services) from 2013-2017 using smart PLS (Partial Least Square). CSR is measured using CSR index, while Share turnover ratio is used to measure IA. CFP is divided into three indicators: ROA, ROE and ROS. The Structural model assessment reveals that CSR has a positive and significant effect on CFP. This means that those listed companies engaged in CSR activities achieved better financial performance than non- CRS companies. The CSR proved to have a negative and significant effect on the IA. This shows that CSR activities lead to decreased IA. Finally, this research found that CSR activities will improve CFP through IA.

scholarly journals Relationship between Corporate Social Responsibility Performance and Systematic Risk—A Case Study of A-share Listed Chinese Companies

2021 ◽  
pp. 66-76
Author(s):  
Chih-Yi Hsiao ◽  
Xue Lin ◽  
Ke-Ke Cen ◽  
Wan-Ping Zheng
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Systematic Risk ◽  
Ordinary Least Squares ◽  
Global Reporting Initiative ◽  
Systematic Risks ◽  
The Government ◽  
Corporate Social ◽  
The Impact ◽  
A Share

Taking the A-share listed companies in the 2018-2019 Environment, Social and Governance (ESG) rating by the China Alliance of Social Value Investment (CASVI) as samples, we analyze the impact of Corporate Social Responsibility (CSR) performance on the current systematic risk and its deferred effect. By using quantile regression and the ordinary least squares (OLS) for cross-comparison, we find that 1) for high-risk companies, the current performance of CSR can help reduce systematic risks, and 2) for low-risk companies, the more progress they make in CSR performance but do not disclose social responsibility information according to the global reporting initiative (GRI) guideline, the more systematic risks they will encounter; if they proactively disclose such reports, however, they may reduce systematic risks. Based on our findings, we propose the following measures: 1) the government should properly guide economic development; 2) companies should actively disclose CSR reports so as to achieve a win-win result for both the companies and their stakeholders; 3) investors should consult social responsibility information to make rigorous investment plans, before making investment decisions.

scholarly journals Corporate Social Responsibility and Insider Trading: Evidence from China

2018 ◽  
Vol 10 (9) ◽  
pp. 3163 ◽  
Author(s):  
Chao Lu ◽  
Xuetong Zhao ◽  
Jingwen Dai
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Insider Trading ◽  
Internal Control ◽  
Voluntary Disclosure ◽  
Financial Information ◽  
Mandatory Disclosure ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

Corporate Social Responsibility (CSR) is the obligation of a company to pursue long-term goals, and is an important part of a sustainable society. It is related not only to the survival and sustainable development of the company, but also to the expectations of the public. CSR is an important way for companies to disclose non-financial information. Information disclosure can alleviate information asymmetry effectively, improve the quality of internal control, and affect the occurrence of insider trading. However, the existing research has paid less attention to the impact of non-financial information on CSR and insider trading, as well as the impact of the corporate nature and disclosure motivation on this relationship. This paper takes China’s 2011–2016 Shanghai and Shenzhen A-share listed companies as a sample to study the relationship between CSR and insider trading. The results show the following. (1) CSR and insider trading have a significant negative correlation. (2) From the perspective of the nature of the enterprise, the CSR of non-state-owned enterprises can significantly suppress the occurrence of insider trading, while the relationship is not significant for state-owned enterprises. (3) From the perspective of disclosure motivation, voluntary disclosure can significantly suppress the occurrence of insider trading. However, mandatory disclosure and semi-mandatory disclosure are not significant. The research in this paper is of great significance to encourage enterprises to fulfill their social responsibilities and improve the supervision of illegal insider trading.

Does corporate social responsibility reduce information asymmetry? Empirical evidence from Australia

2018 ◽  
Vol 44 (2) ◽  
pp. 188-211 ◽  
Author(s):  
Van Ha Nguyen ◽  
Frank W Agbola ◽  
Bobae Choi
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Information Asymmetry ◽  
Fixed Effects ◽  
Negative Relationship ◽  
Jel Classification ◽  
Firm Level ◽  
Listed Firms ◽  
High Level ◽  
Corporate Social

This study examines whether corporate social responsibility (CSR) reduces information asymmetry (IA). Using a firm-level CSR dataset of Australian publicly listed firms from 2004 to 2014, we estimate IA models using a fixed-effects panel estimator. We find that CSR performance is negatively associated with IA. Moreover, this negative relationship is stronger for larger firms and firms with stronger market power. We also find that the negative association between CSR and IA decreases for firms with a high level of equity risk. Our results are robust to alternative measures of CSR and IA, model specifications and endogeneity controls. JEL Classification: D82, G34, M14

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