What is driving corporate social and environmental responsibility in China? An evaluation of legacy effects, organizational characteristics, and transnational pressures

Abstract

China’s unique institutional environment, political system and developmental stage have combined to create what some scholars have dubbed “CSR with Chinese characteristics”. This study focuses on Chinese manufacturing companies listed on the Shanghai Stock Exchange (SSE) in order to identify the internal and external, domestic and transnational variables that explain the differences in CSR performance, as well as performance in specific CSR sub-fields, such as environmental and community responsibility. Our results show that firm size, profitability, industry, supervisory board size, and export levels are all significant determinants of overall CSR performance, mostly supporting other research on the influences of resource availability, efforts to secure public legitimacy, and “trading up” processes. We also find, however, that there are different combinations of drivers for CSR performance in different CSR sub-fields. While transnational pressure (as exemplified by export sales) is an important driver of environmental performance, it does not necessarily drive social performance. More research is needed, then, to understand other limitations of the “trading up” hypothesis, and to identify other mechanisms for increasing CSR performance across CSR sub-fields in China and beyond.