Institutional investors’ corporate site visits and corporate social responsibility

Abstract

This study investigates how institutional investors’ corporate site visits, that is institutional investors’ active information mining behavior, affect corporate social responsibility (CSR). Using companies listed on the Shenzhen Stock Exchange from 2014 to 2018, we found that corporate site visits by institutional investors can improve corporate social responsibility. The impact is more pronounced for an enterprise with a poor information environment and poor corporate governance. We also conducted robustness tests to make sure of the correctness of the results, including the use of alternative measures for institutional investors’ corporate site visits and corporate social responsibility, and the control of firm-fixed effects. We also found that institutional investors’ corporate site visits have a stronger impact on improving corporate social responsibility in companies with low institutional ownership, which shows the relationship between institutional ownership and institutional investors’ corporate site visits. Our study supports the positive effect of institutional investors’ presence on corporate social responsibility.