Corporate Social Responsibility In China Research Articles

Corporate Social Responsibility in China: A Tool of Policy Implementation

Abstract Corporate social responsibility (CSR) in China is a result of political, regulatory, and administrative pressures and civil society pressures. The Chinese Communist Party (CCP) plays a dominant role in deciding the content of CSR, while the other influences are rather limited. As a result, Chinese CSR has not only voluntary and explicit elements but also mandatory and implicit elements. On the one hand, companies can perform CSR in a way that aligns with their commercial interests. On the other, CSR is a response to the CCP’s political pressure, while corporate failure to satisfy the requirements can result in serious negative impacts on companies’ business. In China, CSR has moved far from its origins as a tool of reputation enhancement and assumed a sui generis meaning as a tool of policy implementation. CSR has been evolving towards legal requirements in other jurisdictions as well, such as the EU. However, in China, the main force behind CSR comes from the CCP, which wields legislative and administrative power to promote CSR in a way that aligns with its political interests.

The evolution of corporate social responsibility in China: Do political connection and ownership matter?

The rising CSR awareness globally has influence CSR development in China but unlike anywhere in the world, the central government is always the main driver of CSR here, making it a unique case study. Under this political state, this study examines how a firm's political connections and foreign ownership affects its CSR reporting. We study a long sample over 4 different stages of CSR development in China between 2006 and 2019 with panel regression analysis. Our results show that CSR reporting and participation have increased over the sample period, but firms with political connection and foreign ownership are associated with lower levels of CSR reporting. The findings contradict theories of political cost theory that fit well in other countries. We propose crony relationship to explain the phenomena of low CSR compliance in the political linked firms in China. We further study Xi Jinping (XJP) regime and find that CSR reporting in China improved significantly in this regime but XJP regime moderates the state and foreign owned firms differently. Under XJP government, crony relationship has reduced following improved CSR reporting in politically connected firms, but CSR score has declined in foreign owned firms, implying they have become more opportunistic in cutting business cost and seeking profit.

Executive compensation, internal control quality, and corporate social responsibility in China

AbstractWe explore the relations among executive compensation, internal control quality (ICQ), and corporate social responsibility (CSR), focusing on improving the CSR outcomes of listed firms in China. Our findings are fourfold. First, we document that executive compensation and ICQ have a significant positive impact on CSR. Second, we find that executive compensation positively affects ICQ; hence, we identify ICQ as a channel that can further improve the impact of executive compensation on CSR. Third, we discover that the documented effects are stronger in state‐owned firms than in non‐state‐owned firms. Fourth, we observe that regulatory changes have both positive and negative impacts on CSR. Our findings are less vulnerable to endogeneity and have key implications for policy makers.

Greenwashing in Corporate Social Responsibility: A Dual-Faceted Analysis of Its Impact on Employee Trust and Identification

Corporate social responsibility (CSR) has emerged as a pivotal area of focus, with an increasing number of companies prioritizing its integration into their operational strategies. Nonetheless, because of the dual factors of corporate legitimacy and the pressure exerted by stakeholders, some companies use their CSR disclosures to screen positive impressions and good images, known as greenwashing. Existing literature delves deeply into the consequences of greenwashing from both consumers’ and companies’ perspectives; however, the consequences on employees remain largely unexplored. Another consideration is that greenwashing in CSR research has almost exclusively relied on a catchall CSR construct despite CSR being manifested in philanthropic CSR, business-process CSR, social alliance CSR, and value-chain CSR facets. Therefore, the purpose of this study is to explore the consequences of greenwashing in CSR on employees and to examine whether and how greenwashing across various CSR facets results in different employee responses. Partial least squares structural equation modeling (PLS-SEM) was used to analyze the structural relationships posited in our conceptual framework. By analyzing 304 employees whose companies had experience implementing CSR in China, this study found that greenwashing in primary-stakeholder-oriented CSR was negatively related to trust, and greenwashing in secondary-stakeholder-oriented CSR had a negative and significant impact on employee–company identification. Interestingly, each type of CSR greenwashing had no bearing on the other’s trust and identification. Furthermore, greenwashing in both CSR types indirectly decreases employee loyalty through the respective mediators of trust and identification. Theoretical and managerial implications are provided.

Cultural inclusivity and corporate social responsibility in China

This paper aims to explore whether cultural inclusivity has a significant impact on corporate social responsibility (CSR). The research shows that firms located in regions with higher cultural inclusivity tend to take on more social responsibilities, suggesting that corporate humanistic care and environmental awareness are linked to cultural inclusivity. Furthermore, the effect of cultural inclusivity is more evident in large firms, state-owned enterprises, and firms with high board independence. The use of natural disasters as an instrumental variable in the analysis helped to address endogeneity concerns. Additionally, the outcomes indicate that regions with greater exposure to cultural inclusivity tend to exhibit more characteristics of “gender equality” and fewer characteristics of “power gap”, which have a strong correlation with CSR. These findings shed light on the impact of cultural inclusivity on corporate governance and help explore the informal institutional factors influencing CSR at the geographical level.

The Impact of Corporate Social Responsibility on Financial Performance: The Case of Internet-based Enterprises in China

"With the development of the economy and society, enterprises are no longer just profit organizations. They need to meet the demands of people to fulfill their social responsibilities. The development of Corporate Social Responsibility in China has only been more than a decade, and it is still in the initial exploration stage. Most companies initially adopted a wait-and-see attitude towards it. This article will take the perspective of listed internet companies in China and construct a social responsibility evaluation index system to empirically analyze the relationship between social responsibility and financial performance of internet-based companies. It will explore whether the cost of Corporate Social Responsibility will have a negative impact on their economic benefits. Based on this, it will help internet-based companies correctly understand the important position of social responsibility in their management system and enhance their awareness of actively taking social responsibility."

A CiteSpace-based Analysis of Corporate Social Responsibility Research in China

This paper applies CiteSpace, a visualization analysis tool, to analyze the inner relationship among documents collected from “Chinese Social Sciences Citation Index”, to unveil the present situation and future orientation of studies on corporate social responsibility in China.

Localizing corporate social responsibility in China: The role of geographic proximity to political and financial centers

Early studies on corporate social responsibility (CSR) in China focused on political factors, but recent research highlights the increasing role of markets and finance. This study aims to investigate whether politics remains the primary driver of CSR as the Chinese CSR market evolves. Specifically, it examines the influence of geographic proximity, particularly political and financial centers, on CSR performance in China. Analyzing political and financial attributes of various cities, the study identifies key drivers of CSR engagement. Using 24,399 annual observations of listed company headquarters' locations and distances from political and financial centers, the research reveals that the economy has replaced politics as the main driver of CSR in China. Firms closer to administrative and financial centers demonstrate stronger CSR performance. Additionally, the study emphasizes the significance of shared prosperity demonstration zones initiated by the Chinese government, which drive CSR activities. These findings highlight the impact of geographic location on CSR performance and the alignment between common prosperity and CSR in China. By contributing to literature on geographic location and CSR, this study provides insights into institutional factors influencing firms' CSR engagement.

Inhibiting or promoting: The industry heterogeneity of board interlocks and corporate social responsibility in China

The relationship between board interlocks and corporate social responsibility (CSR) has been much debated, and the limited understanding of the heterogeneity of board interlocks is considered a significant reason. Based on resource dependency theory, this study aims to investigate the impact of the heterogeneity resulting from interlocked directors’ presence in different industries on CSR. This study used a sample of Chinese-listed companies from 2012 to 2019 and employed multivariate regression analysis models. The empirical results suggested that the industry heterogeneity of board interlocks positively impacts CSR. Furthermore, the impact of industry heterogeneity is more significant in state-owned enterprises (SOEs) or companies that receive greater media attention in the Chinese context. This study contributed to the literature by confirming the importance of industry heterogeneity of board interlocks and provided some managerial implications for companies to promote CSR by selecting specific directors.

Corporate social responsibility in China's airline industry: A longitudinal content analysis of related reports

As China has become the world's largest consumer market and leading exporter, researchers and practitioners urgently need to understand how corporate social responsibility (CSR) is socially constructed in the Chinese context, especially for international industries such as the airline sector. Building upon the triple bottom line model, this study offers a contextualized and dynamic understanding of Chinese airline CSR. Content analysis was performed to analyze 74 aggregate CSR reports (2007–2020) issued by different types of Chinese airlines. The findings reveal that in addition to the economic, social, and environmental responsibilities that are commonly seen in the West, Chinese airlines assume unique political responsibilities. This political dimension of CSR in China has become increasingly obvious in recent years. Driven by factors such as international pressure, industry competition, and more importantly, national policies, the focus of Chinese airline companies' CSR reporting has been changing over time. However, it has maintained a high level of content completeness over the years, and the social dimension of CSR has always been the aspect of greatest concern. This study contributes to the airline CSR literature by considering the particularity of airline companies and Chinese contextual factors and augmenting political CSR as a critical component of CSR in the Chinese context. Managerial implications are provided for international enterprises to cater more appropriately to the Chinese market and achieve cooperation with Chinese enterprises by implementing CSR strategies.

Returnee entrepreneurs’ effects on external and internal CSR in China: the moderating role of market embeddedness and government endorsement

PurposeLittle attention has been given to the effects of returnee entrepreneurs on external and internal corporate social responsibility (CSR). This study aims to investigate whether returnee entrepreneurs engage in more external or internal CSR and to further explore the contingency effects of foreign market embeddedness and local government endorsement.Design/methodology/approachThis study uses 11,967 startups in China to examine the relationship between returnee entrepreneurs and external and internal CSR. The authors use an ordinary least square regression and propensity scoring matching approach to analyze the data.FindingsThe empirical results show that returnee entrepreneurs are more likely to undertake external CSR but less likely to undertake internal CSR. Foreign market embeddedness and local government endorsement have opposite moderating effects on these relationships.Practical implicationsThis study has important implications for returnee entrepreneurs’ strategic choice between external and internal CSR and also provides theoretical support for policymakers to make effective and enforceable CSR policies.Originality/valueThis study discusses how returnee entrepreneurs implement external or internal CSR in China, answering the call to distinguish between external and internal CSR. Drawing on a legitimacy perspective, the authors find interesting and seemingly counterintuitive effects of returnees on external and internal CSR, which also necessitates distinguishing between these two types of CSR. In addition, the authors find different moderating roles of foreign market embeddedness and local government endorsement.

Do Reputation Incentives Matter? Busy Directors and Corporate Social Responsibility in China

This paper aims to examine the effect of busy directors on corporate social responsibility (CSR) based on their directorships’ reputation incentives. Using the panel data of Chinese-listed companies in the Shanghai and Shenzhen stock exchange between 2016 and 2021, fixed-effects panel regression analysis is employed as the empirical methodology. In so doing, we find that the effect of busy directors on CSR appears to be nonlinear. Then, by focusing on the relative size of the firms served by busy directors, our study further shows that busy directors can improve CSR in their relatively more prestigious directorships. Nevertheless, busy directors may induce negative CSR in their relatively less prestigious directorships. These results together identify reputation incentives as one factor in determining whether busy directors affect CSR. Therefore, we conclude that reputation is an effective mechanism that can motivate busy directors to monitor and advise CSR.

Social Responsibility in Environmental Protection of Clothing Brands in China: A Case Study of ANTA

Corporate social responsibility was proposed by Bowen in 1953, but Chinese companies began to attach importance to it in the 21st century. China is a big exporter of clothing and textiles in the world, but there is little research on the social responsibility of Chinese clothing companies. Environmental problems have always been hot and arduous. The process of clothing production will cause a lot of negative impacts on the environment, so environmental protection is an important social responsibility of textile and clothing enterprises. Through the case study of Anta Group, this study discusses how Chinese clothing companies can enhance their sense of social responsibility and become environment-friendly companies. The significance and specific feasible methods of the clothing companies to carry out green activities are mentioned in this paper. This study provides some ideas for other companies on how to fulfill their social responsibilities through a successful case of a large company. We hope that through case analysis, more enterprises will pay attention to environmental responsibility and more research will focus on corporate social responsibility in China.

Optimal Recycling Channel Selection of Power Battery Closed-Loop Supply Chain Considering Corporate Social Responsibility in China

With economic development and societal progress, the supply chain should not only focus on profitability, but also environmental protection, as well as undertake corresponding corporate social responsibility (CSR). The operational decisions of the closed-loop supply chain (CLSC) in the power battery industry should rather consider the impact of CSR. Thus, this paper studies the optimal recycling channel selection and coordination of CLSC in the power battery industry under the consideration of CSR efforts and uncertain demand. By considering the CSR efforts taken by the manufacturer, decentralized and coordination decision-making models under different recycling modes (including manufacturer recycling, retailer recycling and third-party recycling) are constructed to analyze the optimal decision of CLSC. After that, the models were validated through numerical and sensitivity analysis, followed by discussion and management insights. It is found that when consumers are sensitive to the level of CSR effort, CSR effort has a positive impact on the profits of participants in CLSC. Additionally, the coordination decision-making model always outperforms the decentralized decision-making model under the same recycling mode, so reasonable profit-sharing contracts are developed to ensure the implementation of coordination decision-making. Moreover, transfer price plays different roles in different decision situations and recycling modes, while recycling cost is critical to the overall profit of the supply chain and influences the choice of recycling channel.

Improve employee-organization relationships and workplace performance through CSR: Evidence from China

Although CSR research in China has received increasing scholarly attention, employee-centered CSR is still an understudied topic. To fill the void, the purpose of this study is to demonstrate the effects of employees' CSR perceptions on the quality of employee-organization relationships and workplace performance, as well as the underlying mechanisms explaining such effects, in the Chinese context. Guided by both managerial and relational approaches of corporate social responsibility (CSR) research, we conducted a survey (N = 248) with employees from a large private company in the electric and energy industry in China. Data were analyzed via path analysis using R packages (e.g., lavaan) and results revealed that CSR perceptions can lead to positive employee-organization relationship quality and increase employees' extra-role performance. We also found that these effects can be further explained by increased employee-organization identification or perceived corporate ability. In addition, a qualitative analysis of employees' responses showed that the influence of government and Confucianism was reflected in employees' expectations for their employer's CSR initiatives. This study contributes to the scant research on employee outcomes and the underlying mechanisms of employee-centered CSR in China. Practically, we add empirical evidence addressing the value of internal CSR for professionals and educators.

Corporate Social Responsibility: Does Religious Community Matter?

Corporate social responsibility is crucial to the sustainability of a firm, yet its motivating forces remain obscure. Therefore, this paper uses 1130 listed firms over the period 2010–2021 as the sample to explore the effect of religious community on corporate social responsibility in China. Using a firm and year-fixed effects model for empirical analysis. The findings reveal that the number of religious communities around a firm within a radius of less than 10, 50, and 100 km all has a favorable influence on corporate social responsibility. Moreover, the results of heterogeneity analysis show that religious community has a smaller positive impact on corporate social responsibility in low-polluting firms than in high-polluting ones. Additionally, using the robustness test, it is conceivable to conclude that the findings presented in this study are reliable and robust. This paper contributes to and broadens the existing body of research on corporate social responsibility and religious community, which has significant ramifications for the importance of religious community in the conduct of business.

Restricted shares and CSR: Evidence from foreign strategic investors in China

Using hand-collected ownership data from a large sample of Chinese listed firms, we examine the link between foreign strategic ownership and firms' corporate social responsibility (CSR). We find that foreign strategic ownership is significantly associated with greater CSR performance. The restrictions of shares are the main motivation behind foreign strategic investors (FSIs) increasing firms' CSR engagement. The influence of foreign ownership on CSR is driven by strategic investors with non-tradable shares, but not by Qualified Foreign Institutional Investors (QFIIs) with tradable shares. FSIs with longer restriction horizons and in firms with stronger political connections are found to have more pronounced effects on CSR. We also find FSIs' home country characteristics, including the legal system, cultural background, geographic distance, trade relationship, and economic policy uncertainty, are significant factors in explaining their incentives to increase firm CSR in China. From the perspective of corporate governance, we find that the impacts of FSIs on firms' CSR performance is more pronounced when shareholder power is stronger and executive power is weaker in the firm. Difference-in-differences tests and tests based on instrumental variables provide confirming evidence. Overall, our findings suggest that restricted ownership, political connections, and foreign investors' home country characteristics provide incentives for FSIs to pay more attention to firms' long-term reputation and thus enhance CSR engagement.

How does green credit policy improve corporate social responsibility in China? An analysis based on carbon‐intensive listed firms

AbstractFor China to become carbon neutral, green financing is seen as a crucial avenue, wherein the green credit policy, which was introduced in 2012, is a crucial tool. However, whether the policy would work and how to improve its effectiveness remain unknown. This study attempts to analyze the policy's effects on carbon performance, a crucial measure of Corporate Social Responsibilities (CSR), particularly in carbon‐intensive industries, using a sample of Chinese listed companies from 2009 to 2018. As a result, first, it's confirmed that the policy can boost carbon performance of carbon‐intensive firms. Additionally, this study has verified that firm's R&D investment intensity has no mediating role in the relationship between the policy and carbon performance, while debt financing cost partly mediating the relationship, implying the policy fails to stimulate technological innovation. Moreover, firms with stronger environmental regulation intensity, weaker financing constraints, poorer corporate governance and more analyst following have greater promotion in carbon performance after the policy execution. Finally, the policy significantly improves the quality of corporate environment information disclosure. Briefly, this study enriches theoretical grounding regarding strategies of green reform in carbon‐intensive industries and provides implications for emerging economies to improve green finance via enhancing CSR.

Distances Matter: Parent’s CSR Reputation and CSP of Multinational Enterprises’ Subsidiaries

Prior studies found that foreign subsidiaries of multinational enterprises (MNEs) suffer from liability of foreignness (LOF). According to stakeholder theory, foreign subsidiaries may be able to improve their legitimacy of business practices and overcome LOF by demonstrating social commitments to host-country constituents through corporate social responsibility (CSR). This study doesn’t only investigate whether the distances between the MNE home countries and China (host country) affect multinational enterprises (MNEs) foreign subsidiaries’ corporate social performance (CSP), but also examines how sub-national institutions affect the subsidiaries engaging in CSR in China. The study further tests the moderating role of parent’s CSR reputation. Using the data from 2009 to 2015 in the blue books of corporate social responsibility issued by Research Center for Corporate Social Responsibility Chinese Academy of Social Sciences (CASSCSR), the study adopts the top 100 foreign-invested enterprises in China as our sample. The CASSCSR collected the CSR information via their CSR reports, financial reports and official websites; they did an all-around research and valuation on their current CSR information disclosure. The results show the effect of distances on subsidiaries’ CSP in China, and highlight the importance of parent’s CSR reputation as a mechanism that may induce foreign subsidiaries to engage in CSR in China.

A comparative analysis of corporate social responsibility development in the USA and China

PurposeThis paper aims to conduct a comparative study between the historical development of corporate social responsibility (CSR) in both the USA and China. It is motivated by the phenomenon that CSR is developing in two different directions (global vs local).Design/methodology/approachA comparative study on sustainability-linked compensation illustrates how CSR in the USA is driven by firm-level economic decisions, in which the manifestations of CSR are usually those which prove to be the most profitable financially. Moreover, a case analysis on the green bond market in China contrarily illustrates how CSR in China is usually based more on alignment with top-down, state-led initiatives in which the state directs the ways in which CSR is manifested.FindingsThis paper reveals that despite globalizing trends are attempting to unify definitions of CSR, they inevitably become localized to fit the societal needs in which they are located.Originality/valueBy understanding how CSR development in these two countries has changed over time, this paper shows that future developments in CSR will likely be influenced more by local practices than by converging global forces.