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.

scholarly journals Corporate Social Responsibility Disclosure and Stock Price Crash Risk: Evidence from China

2019 ◽  
Vol 11 (2) ◽  
pp. 448 ◽  
Author(s):  
Jingwen Dai ◽  
Chao Lu ◽  
Jipeng Qi
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Voluntary Disclosure ◽  
Information Disclosure ◽  
Stock Price ◽  
Crash Risk ◽  
Significant Difference ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

We take Chinese A-share listed companies in years 2010–2015 as a sample to examine the relationship between Corporate Social Responsibility (CSR) information disclosure and stock price crash risk using the fixed effect model. The results show that: (1) There is an inverted U-shaped nonlinear relationship between CSR information disclosure and stock price crash risk. That is, as the CSR information disclosure level increases, the CSR information disclosure first aggravates and then reduces the stock price crash risk; (2) under different disclosure motives, there is a significant difference in the impact of CSR information disclosure on stock price crash risk. There is still an inverted U-shaped relationship between mandatory CSR information disclosure and stock price crash risk, but not for the semi-mandatory and voluntary disclosure; (3) the academic independent director has a positive adjustment effect on the relationship between CSR information disclosure and stock price crash risk, while the institutional investor has a negative adjustment effect on the relationship between CSR information disclosure and stock price crash risk. The research is of great significance for promoting the fulfillment of CSR, improving corporate governance and stabilizing the capital market.

Impact of corporate social responsibility (CSR) awareness, affordability and management system sophistication on CSR performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Anura De Zoysa ◽  
Nobyuki Takaoka ◽  
Yuqian Zhang
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Management System ◽  
Structural Equation ◽  
Critical Role ◽  
Content Type ◽  
Japanese Firms ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

PurposeThis paper aims to examine the impact of three key factors — corporate social responsibility (CSR) awareness, CSR affordability and CSR management system (CSRMS) sophistication—on the CSR performance of Japanese firms.Design/methodology/approachUsing responses to 36 items developed on the Global CSR standard of ISO26000, two CSR indexes were constructed to assess the CSR management system sophistication and performance of Japanese firms. The relationship between the three key variables (CSR awareness, affordability and management system sophistication) and CSR performance was then examined through a partial least squares (PLS)-based structural equation model. Data were collected through a questionnaire survey of 146 firms.FindingsThe results of the study found a positive relationship between CSR performance and three exogenous variables (CSR awareness, affordability and management system sophistication). Furthermore, the study found that CSRMS sophistication played a mediating role in the relationship between CSR performance and firms' CSR awareness and affordability.Research limitations/implicationsThe study was limited to examining the CSR practices of a major province in Japan, which may hinder the generalisation of the findings to the rest of the country. Moreover, the data used for assessing the variables in this study were self-reported by the participating firms, in addition to being cross-sectional. The findings of this study clarified areas that policymakers, including Japan's business associations–Keidanren and Keizai Doyukai, and other relevant parties need to focus on for further improving CSR performances of Japanese firms.Originality/valueThis study highlights the role CSR awareness, affordability and CSRMS sophistication play in improving CSR performance. On the one hand, it identifies the critical role CSRMS plays in mediating the relationship among CSR performance, awareness and affordability. On the other hand, it advances CSR theory providing insight for practitioners to generate positive CSR outcomes.

scholarly journals Market Responsiveness to Corporate Social Responsibility

2019 ◽  
Vol 8 (4) ◽  
pp. 114
Author(s):  
Zev Fried
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Reporting ◽  
Perceived Quality ◽  
Financial Information ◽  
Factors Affecting ◽  
Earnings Response Coefficients ◽  
Corporate Social ◽  
The Impact

Market reaction to surprises in earnings announcements has long been used to measure the quality of the information content of the announcement, and studies have explored various factors affecting the response. This study adds to this body of research by factoring in the level of corporate social responsibility (CSR) exhibited by the firm and employs a relatively new measure of a company’s level of CSR, rankings published by JUST Capital. I hypothesize that financial information reported by higher ranked companies is weighed more heavily by investors than those reported by non-ranked or lower-ranked companies. Using earnings response coefficients as a measure of the perceived quality of the financial information reported by the firms, my results provide direct support of the hypothesis, indicating that the market reacts more strongly to earnings surprises for firms with high JUST rankings than for unranked firms or firms with lower rankings. This result contributes new insights into the impact of a firm’s CSR in terms of the perceived quality of a firm’s financial reporting.

scholarly journals Do Employees Matter in the Relationship between Corporate Social Responsibility and Financial Performance?

2019 ◽  
Vol 11 (22) ◽  
pp. 6251 ◽  
Author(s):  
Jae Mee Yoo ◽  
Woojae Choi ◽  
Mi Lim Chon
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Employee Commitment ◽  
Micro Level ◽  
And Performance ◽  
Internal Stakeholders ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

This study investigated the mechanism behind the impact of corporate social responsibility (CSR) on firms’ financial performance while focusing on internal stakeholders. Although many studies have examined the effects of CSR few has empirically investigated the underlying process of the mechanism. In addition, previous research has rarely regarded employees as a link between CSR and firms’ outcomes, despite employees implementing CSR policies. This study explored the pathway of the CSR-employees-firm’s performance. Employee commitment was used to explain the relationship between CSR and performance, since it is an important employee-associated micro-level outcome of CSR. The results showed that CSR indirectly influenced a firm’s accounting profitability through enhanced employee commitment, as well as directly affected firm’s profitability. CSR increases employee commitment, which in turn leads to improvements in a firm’s accounting returns. The paper suggests that employees should be considered as an important agent for the effects of CSR initiatives.

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.

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.

The relationship between corporate social responsibility and corporate reputation in a turbulent environment: Spanish evidence of the Ibex35 firms

2015 ◽  
Vol 15 (4) ◽  
pp. 563-575 ◽  
Author(s):  
José Luis Fernández Sánchez ◽  
Ladislao Luna Sotorrío ◽  
Elisa Baraibar Diez
Keyword(s):  
Corporate Social Responsibility ◽  
Financial Crisis ◽  
Social Responsibility ◽  
Corporate Reputation ◽  
Content Type ◽  
Current Financial Crisis ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship ◽  
Positive Effect

Purpose – The purpose of this study is to provide more knowledge about the model to generate reputation and its relationship in the long term with companies’ strategy of social responsibility. Particularly, research is done to test whether there is a positive effect of firms’ social behaviour (corporate social responsibility [CSR]), analysing differences of intensity and consistency, on their corporate reputation (CR) and whether the current financial crisis is a factor that has changed the relationship between both variables (moderator factor). Design/methodology/approach – This study uses a sample of 26 Spanish large firms of the Ibex35 index and covers an eight-year period from 2004 to 2011. To test the hypotheses of this research, a fixed-effects model was estimated using moderating regression analysis. Findings – The results obtained show that, for the Spanish Ibex35 companies, CSR practices according to their consistency have a significant positive effect on CR and in turbulent environments, as in the current financial crisis, it has had a significant positive influence on the CSR-CR relationship. Originality/value – Although a substantial number of empirical studies have examined the relationship between firms’ strategy and their performance, only a few of them have analysed the impact of the external environment on this relationship, whereby there is a need for longitudinal studies with different economic scenarios to achieve better knowledge of the CSR–CR relationship.

scholarly journals Impact of Companies’ Characteristics on the Relationship between Corporate Social Responsibility Disclosure and Corporate financial Performance - An Empirical Analysis

2021 ◽  
Vol 39 (7) ◽  
Author(s):  
Sayeed Zafar Qazi ◽  
Parvesh Kumar Aspal
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Empirical Support ◽  
Corporate Financial Performance ◽  
Economic Point ◽  
Corporate Social Responsibility Disclosure ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

Strategic managers are persistently accosting with the decision of switching the scared corporate resource for the community welfare to balance the shareholders’ and multiple stakeholders’ interests. Corporate houses are presumed to not only intensify the economic priorities of investors, but must also consider the community and environmental ramifications as well. Presently, corporations are in dilemma over whether investment in corporate social responsibility (CSR) initiatives will be a cost or gain from an economic point of view. For this purpose, the association between CSR disclosure and corporate financial performance has been empirically explored and also the company characteristic has been considered as a significant and interesting factor influencing the association between CSR and corporate financial performance. The prime objective of the present paper is to examine the impact of companies’ characteristics i.e., Age of company on the relationship between corporate social responsibility disclosure and corporate financial performance. Panel data regression statistical technique has been applied to investigate and analyze the relationship. The findings of the study reveal that companies CSR have significant influence on their financial performances.  But, on the other hand the company characteristic, age of the company has no significant impact on the corporate financial performance. The findings are found consistent with earlier studies, which validate the company’s venture in undertaking the CSR initiatives. The present study addresses theoretical as well as empirical support and inspiration for the corporations towards CSR initiatives.

scholarly journals Impact of Corporate Social Responsibility on the Financial Performance of Banks in Pakistan

2014 ◽  
Vol 21 ◽  
pp. 9-19 ◽  
Author(s):  
M. Shoukat Malik ◽  
Muhammad Nadeem
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Service Sector ◽  
Annual Reports ◽  
Net Profit ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

The purpose of this paper is to investigate the impact of Corporate Social Responsibility on the Financial Performance of banks in the service sector of Pakistan. The data is obtained from the annual reports issued by the banks during 2008-2012. To verify the relationship between EPS, ROA, ROE, Net Profit and CSR regression models are used. The results show that there is lack of CSR in Pakistan and the regression model shows that there is positive relationship between profitability (EPS, ROA, ROE, and Net Profit) and CSR practices. The Financial institutions which implements CSR in their operations earn more profit for the long term periods.

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.

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