Social Responsibility, Institutional Environment and Stock Price Crash Risk: Evidence from Chinese GEM

Abstract

The stock price crash risk has become the focus of corporate finance and macroeconomics research in recent years because it affects the stock market, listed companies, market investors and the real economy. This paper takes 1822 gem listed companies from 2011 to 2017 as samples, and empirically tests the impact of social responsibility on the risk of stock price collapse and takes into account the regulatory effect of institutional environment. The study finds that social responsibility can inhibit the stock price collapse risk of listed companies on the growth enterprise market, and the institutional environment can also inhibit the risk of stock price collapse of listed companies on the growth enterprise market. Considering the influence of the institutional environment, the influence of social responsibility on the risk of stock price collapse of listed companies on the growth enterprise market is more obvious, which shows that the institutional environment has a moderating effect between social responsibility and the risk of stock price collapse. This conclusion still exists after considering the endogenous influence. Further research shows that the inhibiting effect of social responsibility and the regulating effect of institutional environment are more obvious among gem listed companies in the first year of listing.