Abstract
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.
Highlights
Stock price crash risk measures the possibility of a stock price collapse of a listed company, which can be attributed to principal-agent problems and information asymmetry [1,2]
Since the test results of Hypothesis 1 (H1) and Hypothesis 2 (H2) show that there is an inverted U-shaped relationship between Corporate Social Responsibility (CSR) information disclosure and stock price crash risk in the disclosed and mandatory disclosure samples, we examined the role of adjustment factors in these two samples
The results indicate that institutional investors will weaken the positive effect of CSR information disclosure on the stock price crash risk, and strengthen the negative correlation between the two, that is, Hypothesis 4 (H4) is established
Summary
Stock price crash risk measures the possibility of a stock price collapse of a listed company, which can be attributed to principal-agent problems and information asymmetry [1,2]. As negative information accumulates and erupts, investors begin to sell the stocks, making the stock price of the company more likely to collapse. In addition to impacting the capital market, the stock price crash risk may lead to misallocation of resources and negative effects on the real economy [4]. Since 2015, the sharp rise and fall of Chinese stock market has caused a huge impact on financial market stability and investor wealth, and the extreme tail event risk, such as stock price crash risk has attracted more and more attention
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