Abstract
Under the general background of negative impacts brought by economic policy uncertainty (EPU), companies have been motivated to foster a good and healthy company image, arouse high attention from investors, and mitigate crises by initiatively releasing their social responsibility report. To explore the impacts of EPU on corporate social responsibility information disclosure, using the sampled data of Chinese A-share listed companies and EPU indexes during 2008-2017, the impacts of EPU on the voluntariness to release social responsibility report, information quality, and future rating were tested; the intermediate mechanisms in the influence of EPU on corporate social responsibility information disclosure were explored; meanwhile, whether the influence of EPU on corporate social responsibility information disclosure varied with voluntariness/compliance, nature of corporate property right, market system environment, and corporate financial performance was explored. Results show that when the EPU is aggravated, the corporate voluntariness to release a social responsibility report is significantly enhanced, including the information disclosure quality, but the expected future social responsibility rating gradually decline. Operation and sales play a partial mediating role in the effects of EPU on facilitating corporate voluntariness to release social responsibility report and improving the disclosure quality, whereas the return on stocks only plays a partial mediating effect in the influence of EPU on the corporate voluntariness to disclose social responsibility report. Meanwhile, the EPU influences corporate social responsibility information disclosure behaviours differently among the samples with different release requirements, natures of property right, market system environments, and financial performances. The conclusions enriches studies on the microeconomic effects generated by economic policy uncertainties and extends studies regarding macro-factors driving companies to make social responsibility information disclosure decisions, thus providing an important reference for the government to formulate or adjust economic policies and for enterprises to execute information disclosure.
Highlights
Enterprises have been adopting the profit-oriented development pattern and taken the profit maximization as the principle
Social responsibility report is an important carrier transmitting the performance of enterprise social responsibilities, and major nonfinancial information disclosed by enterprises
The quality data of corporate social responsibility information and expected data of corporate future social responsibility disclosure came from Rankins CSR Ratings (RKS), economic policy uncertainty (EPU) data from the EPU index compiled by Baker et al (2016), and other data from CSMAR database
Summary
Enterprises have been adopting the profit-oriented development pattern and taken the profit maximization as the principle. Profitability has become the sole criterion for judging an enterprise. Few enterprises have fulfilled their social responsibilities out of their awareness of social responsibility. Just as Milton Friedman pointed out, the only social responsibility of an enterprise is to engage in profit-increasing activities using resources within the scope permitted by laws and regulations. Companies must abandon the traditional concept of “judging by profit,” attach importance to the performance degree of their social responsibilities, and strive toward the sustainable development of the enterprise, environment, and society. Social responsibility report is an important carrier transmitting the performance of enterprise social responsibilities, and major nonfinancial information disclosed by enterprises. Very few enterprises will initiatively release the social responsibility report, and the relevant information disclosure quality has not been optimistic
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