Social Responsibility Performance Research Articles

Does legal justice promote stakeholder justice? Evidence from a judicial reform in China

This paper investigates how judicial quality affects corporate social responsibility (CSR) performance. Employing a difference-in-differences model based on the establishment of circuit courts in China and a sample of Chinese A-share listed firms from 2010 to 2020, we find that enhanced judicial quality improves firms' CSR performance. Further analysis shows that CSR helps reduce the incidence and expense of lawsuits and financial constraints arising after the circuit court establishment and mitigates negative market responses toward lawsuit announcements. This suggests that CSR has strategic value against lawsuits and firms' incentives to reduce litigation costs, financial constraints, and adverse market reactions are the potential mechanisms. The effect of judicial quality on CSR performance is more pronounced for firms with greater ex-ante litigation risk, lower ex-ante CSR awareness, and close to circuit courts. Overall, this study highlights a novel externality of the judiciary and suggests that legal justice can promote stakeholder justice.

Literature Review Regarding Corporate Innovation

This paper systematically reviews the determinants and consequences of corporate innovation. The main findings are as follows. From a micro-level perspective, the diversification of the gender structure of the board of directors, the improvement of the welfare of employees, the corporate social responsibility performance, the external competitive environment, and the choice of innovation strategy can positively promote the company’s innovation and ensure the quality, efficiency, and success rate of innovation. From a macro perspective, judicial independence stimulates innovative activities, while the promulgation of the monopoly law and the uncertainty of the economic policy will dampen the incentives to innovate. As for the consequences of innovation, it helps enterprises transform and upgrade, brings efficient management mode more in line with the operation of enterprises, creates differentiated products for enterprises, helps enterprises reduce costs, and improves the efficiency of employees, etc. This literature review focuses on several latitudes and multiple aspects to elaborate their comprehensive impact on innovation so that readers can understand faster and more conveniently. Moreover, it provides direction for innovation for companies and can also make countries more aware of the importance of innovation. Collectively, this survey is a supplement to the existing literature and has practical implications.

Research on the Social Responsibility Report of Shuanghui Group

Food is an important pillar industry for people’s livelihoods. The food quality and safety of food enterprises are of particular importance. There is a consensus in today’s society that good social responsibility performance can reflect a company’s comprehensive management ability and future long-term sustainable development level. Based on China’s attention to corporate social responsibility, this article selects Shuanghui Group as the research object, analyzes the changes in its social responsibility reports, points out the problems and causes of social responsibility reports, and proposes relevant improvement suggestions.

Job-hopping executives and corporate social responsibility

PurposeThe purpose of this study is to examine the relationship between the corporate social responsibility (CSR) performance of job-hopping executives at their former and subsequent firms.Design/methodology/approachWe conduct regression analyses using a sample of firms listed on the Shanghai and Shenzhen Stock Exchanges from 2010 to 2020 to examine whether CSR performance is similar from one firm to the next as executives switch jobs.FindingsWe find a positive relationship between the CSR performance of former and subsequent firms under job-hopping executives. This relationship is the strongest in the year of the job switch; it weakens in the second year and eventually disappears in the third year. In addition, we show that this relationship benefits different CSR stakeholder groups and is contingent on executive and subsequent firm attributes and job-hopping characteristics. Furthermore, we demonstrate that firms that hire a new chief executive officer from a firm with a strong track record in CSR, the new firm experiences a significant surge in CSR performance compared with firms that do not experience such a shock.Practical implicationsThis study has implications for executive hiring decisions.Originality/valueThis study extends the understanding of CSR determinants through the lens of inter-organisational ties associated with job-hopping executives.

Too much of a good thing: the dual effect of executive equity incentives on corporate social responsibility performance

PurposeResearch on the effect of executive equity incentives is equivocal. Based on agency theory, some scholars take the convergence of interest logic to highlight the benefits of executive equity incentives. In contrast, others adopt the entrenchment logic to emphasize the increased agency costs. This study attempts to reconcile the debate on executive equity incentives and integrates the opposing views to unveil how executive equity incentives impact corporate social responsibility (CSR) performance.Design/methodology/approachUsing the panel dataset of Chinese A-share listed firms from 2006 to 2022, this study integrates the convergence of interest and entrenchment logic to examine how executive equity incentives affect CSR performance.FindingsWe find that the relationship between executive equity incentives and CSR performance follows an inverted U-shaped form. According to the convergence of interest logic, executive equity incentives reduce agency costs when allocating resources to engage in CSR activities and enable firms to increase their CSR investments, ultimately realizing increased CSR performance. After a threshold, however, the accumulation of extensive equity incentives causes the entrenchment effect, resulting in declined CSR performance. Our empirical results also shed new light on its contingent perspective – the inverted U-shaped relationship is attenuated when firms’ stock liquidity is high.Originality/valueThis study attempts to reconcile the debate on executive equity incentives and integrates the opposing views to unveil the inverted U-shaped relationship between executive equity incentives and CSR performance. Our study opens promising avenues for further research on corporate governance and CSR strategies.

A novel IFN-CSM-CoCoSo approach for multiple-attribute group decision-making with intuitionistic fuzzy sets: An application in assessing corporate social responsibility performance

With the rapid growth of the economy, enterprises have encountered a series of problems while pursuing economic benefits, such as food safety and environmental pollution issues, resource shortages and energy consumption issues, which affect the sustainable development of enterprises. Establishing a corporate performance evaluation system from the perspective of social responsibility, based on stakeholder theory and the importance of overall goals reflected in the weight of social responsibility indicators, is a very effective measure to achieve corporate social responsibility (CSR) goals through CSR motivation and stakeholders. The performance evaluation of CSR from the perspective of environmental accounting is a MAGDM. Recently, the CoCoSo technique and cosine similarity measure (CSM) technique was utilized to conduct the MAGDM. The intuitionistic fuzzy sets (IFSs) are utilized as a technique for conducting uncertain information during the performance evaluation of CSR from the perspective of environmental accounting. In this study, the intuitionistic fuzzy CoCoSo based on the CSM (IFN-CSM-CoCoSo) technique is built for MAGDM with IFSs. Finally, a numerical example for performance evaluation of CSR from the perspective of environmental accounting is conducted to verify the IFN-CSM-CoCoSo technique.

Diversity of returnee executives' foreign experience and corporate social responsibility performance.

Top managers' past experiences (e.g., foreign experience) significantly impact their decision-making behavior, which may influence firms' sustainable development. The available literature, focusing on the role of the increase in the number of top executives with foreign experience in corporate social responsibility (CSR), yields mixed results. In order to clarify the ambiguous relationship between executive foreign experience and CSR, we empirically examine the effect of the geographic diversity of top executives' foreign experience on CSR. Based on a hand-collected dataset of the top management team's (TMT's) foreign experience, we demonstrate the positive impact of the geographic diversity of returnee executives' foreign experience on firms' CSR using Chinese A-share listed firms from 2009 to 2018. Moreover, this impact is stronger in firms with political connections with the central government and in regions with good market development. Furthermore, the mechanism analysis shows that returnee executives drive firms' CSR by promoting corporate donations and green innovation. This paper offers clear policy implications by suggesting that hiring returnees with a broad geographic scope of foreign experience as corporate executives is an efficient way to enhance firms' CSR.

The Determinant of Corporate Social Responsibility (CSR): The Role of Green Accounting as Moderating Variable in Indonesia

This study aims to determine the role of Green Accounting in the relationship between environmental performance and Disclosure of Corporate Social Responsibility (CSR) in JII 70 Companies for the 2018-2020 period. This research is a type of quantitative research and the data in this research is secondary data in the form of panel data sampling technique with purposive sampling technique. The samples used were 24 companies registered on JII 70 for the 2018-2020 period. The data collection method is carried out by accessing financial reports and annual reports which can be accessed through the website www.idx.co.id. The data is processed using the Eviews10 analytical tool. The analytical method used is a descriptive test, stationarity test, regression model test, classical assumption test, t-test, F test, and MRA test. The results showed that the environmental performance variable has a positive and significant effect on the disclosure of Corporate Social Responsibility. The green accounting variable has a positive and insignificant effect on the disclosure of Corporate Social Responsibility. After conducting the MRA test it shows that the green accounting variable cannot moderate the effect of Environmental Performance on Disclosure of Corporate Social Responsibility.

ESG performance and litigation risk

We focus on the relationship between firms’ environmental, social, and governance (ESG) responsibility performance and litigation risk. This study finds that improving firm ESG responsibility performance is conducive to reducing firm litigation risk. At the same time, internal control plays an intermediary role in the impact of firms’ ESG responsibility performance on firm litigation risk. Improving ESG responsibility performance can increase the firms’ internal control mechanisms to reduce litigation risk.

CSR performance of dual-class firms in different life cycle stages

ABSTRACT This paper investigates the relationship between corporate social responsibility (CSR) performance and different phases within a firm’s life cycle. Drawing on a sample of U.S. public firms spanning the period from 1991 to 2018, our empirical findings reveal distinct patterns: Younger firms with dual-class equity structures tend to allocate fewer resources to CSR initiatives compared to their single-class counterparts. However, as firms progress into the mature phase of their life cycle, dual-class firms exhibit superior CSR performance compared to single-class firms. Furthermore, we also observe that CEO compensation in dual-class firms tends to be higher during the mature phase. Those findings make a substantial contribution to the fields of agency theory, corporate governance, and business ethics.

Corporate social responsibility and firm-level systematic risk: The moderating effect of economic policy uncertainty

This paper investigates the relationship between corporate social responsibility (CSR) performance, firm-level systematic risk, and variations in economic policy uncertainty (EPU) levels. We examine a dataset of Chinese listed firms, finding that higher CSR performance should reduce firms' systematic risk during periods with relatively high levels of EPU. Furthermore, better satisfaction of primary and secondary stakeholders can help firms reduce systematic risk and increase performance when EPU is high. This evidence supports the implication of stakeholder theory that CSR investment can create substantial relational wealth essential to firms' risk management. Our results also imply that the CSR-systematic risk relationship can be positive when EPU is relatively low. Our findings indicate that the risk-mitigation benefits of CSR are state-contingent and can be better realized during downturns.

Analysing the interplay of isomorphic pressures, perceived benefits and top management support on social responsibility performance of Belt and Road megaprojects

PurposeThis study aims to investigate the factors influencing the social responsibility performance of Belt and Road Initiative (BRI) megaprojects. Specifically, it examines the role of isomorphic pressures and the joint influence of perceived benefits and top management support on megaproject social responsibility performance (MSRP).Design/methodology/approachDrawing from institutional theory, social exchange theory, and top management literature, this study established a conceptual model featuring eleven hypotheses. Subsequently, a questionnaire survey was administered to collect data from 238 actively engaged participants in BRI megaprojects. Structural Equation Modelling was utilised to analyse the data.FindingsThe empirical findings indicate that mimetic and coercive pressures positively influence MSRP. Perceived benefits and top management support significantly enhance MSRP. Moreover, perceived benefits and top management support partially mediate the effects of coercive and mimetic pressures. However, when it comes to normative pressures, their impact on MSRP is solely channelled through the support of top management.Originality/valueThis study is one of the early endeavours to explore the factors influencing the social responsibility performance of BRI megaprojects. It sheds light on the interplay between external pressures and internal factors in shaping social responsibility efforts in these projects. These findings are of particular significance for BRI actors and stakeholders, offering guidance for enhancing social responsibility strategies within the context of BRI megaprojects.

Risk and return efficiency of manufacturing firms: Integrating corporate social responsibility performance

AbstractThis paper uses Data Envelopment Analysis to assess the performance of stocks in terms of return on assets, risk and their Environmental‐Social‐Governance score. Next, latent class analysis (LCA) is used to determine groups with similar performances and relates group membership to a set of covariates. The empirical application employs a set of 139 European manufacturing companies from 2016 to 2021 period. The results suggest stocks on average perform 25% below their potential in each of the three dimensions. The LCA suggests five groups and membership of lower performance classes significantly relates with lower size, R&D expenses and Tobin's Q.

Top Managers’ Rice Culture and Corporate Social Responsibility Performance

Top Managers’ Rice Culture and Corporate Social Responsibility Performance

CFO SERVING AS BOARD SECRETARY AND ENTERPRISE SUSTAINABLE DEVELOPMENT PERFORMANCE

This study utilizes data from Chinese A-share listed companies from 2010 to 2020 as research samples to explore the impact of CFOs serving as board secretary on the quality of information disclosure, financing constraints, and enterprise sustainable development performance. The empirical results indicate that CFOs holding the additional role of secretary of the board significantly enhance the financial performance and environmental and social responsibility performance of companies. The quality of information disclosure and financing constraints act as mediators between the dual role of the CFO and sustainable development performance. Heterogeneity analysis finds that in non-state-owned enterprises and small and medium-sized enterprises, the effects of CFOs serving concurrently as secretaries of the board on improving financial performance, environmental social responsibility performance, information disclosure quality, and alleviating financing constraints are more pronounced. The findings of this study delve into the impact of the dual role of CFOs on sustainable development performance, enrich the literature in the relevant field, and provide valuable theoretical basis and practical guidance for the selection and appointment of corporate executives, tailored for journal publication requirements.

Do corporate bond defaults affect the corporate social responsibility performance of non-defaulting industry peers? Evidence of credit risk contagion from China

ABSTRACT Using Chinese A-share listed firms from 2014 to 2020 as samples, this study investigates the impact of corporate bond defaults on the corporate social responsibility (CSR) performance of non-defaulting industry peers from the perspective of the credit risk contagion effect. The findings show that corporate bond defaults hinder the CSR performance of non-defaulting industry peers. The mechanism test shows that the risk contagion caused by corporate bond defaults lowers the financing and operational capabilities of peer firms, thereby weakening the CSR performance. Furthermore, the inhibitory effect of corporate bond defaults on the CSR performance of other firms in the industry is more significantly evidenced in non-state-owned enterprises, regions with a low degree of marketization, as well as firms with a high degree of financing constraints or a low degree of financing demand.

Corporate governance and corporate social responsibility: Evidence from directors' and officers' liability insurance

AbstractTheoretical theories underpin the governance effect of directors' and officers' (D&O) liability insurance include agency costs and stakeholder interests. Motivated by mixed evidence on the corporate governance effects of D&O, we ask whether and how the directors' and officers' (D&O) liability insurance affects corporate social responsibility (CSR) performance in China, one of the largest and fastest growing economies in the world. We develop two contrasting hypotheses: (1) supervision and incentives versus (2) opportunism. To test these hypotheses, we rely on Chinese A‐share market data and fixed effect panel regressions, along with a battery of robustness checks, including Heckman sample selection bias, two‐stage least square instrumental variable (2SLS‐IV), difference‐in‐difference (DiD), propensity score matching (PSM) analyses. Consistent with supervision and incentives hypotheses and stakeholder theory, we find that D&O liability insurance significantly increases firm's CSR performance and firms renewing D&O liability insurance with the same insurers tend to have better CSR performance. Two possible mechanisms supporting this positive relation between D&O liability insurance and CSR performance are information transparency and accounting conservatism. Aside from theoretical contributions, our findings offer important practical contributions such as promoting D&O as external governance and ensuring the functions of D&O insurance comprehensively and correctly understood. Integrating D&O insurance with CSR can be viewed as an important business strategy by mitigating risks, enhancing reputation, ensuring legal compliance, and supporting responsible decision‐making.

The role of Cross‐Border alliances in corporate social responsibility: International evidence

AbstractWe examine how forming cross‐border alliances with US firms influences the corporate social responsibility (CSR) performance of their foreign partner firms. Analyzing a sample across 39 countries between 2002 and 2018, we find that these foreign firms experience higher future CSR performance, with a notable 6.46% increase compared with those without such alliances. Moreover, this effect is stronger in foreign firms from countries with weaker governance institutions, lower social norms, and worse economic conditions. Also, foreign firms with lower governance quality, higher market competition, and weaker innovation capacity show a pronounced improvement in CSR performance after alliances. The improved CSR performance also leads to higher firm value and better earnings quality in these foreign firms. Overall, we highlight the role of cross‐border alliances in facilitating the attainment of broader economic and sustainable governance objectives.

Are country-level political uncertainty and power distance important to the CSR-audit report lag nexus? Evidence from the GCC region

ABSTRACT This study examines the effect of corporate social responsibility (CSR) performance on audit report lag and whether political uncertainty and power distance levels impact such association. We find that audit report lag is significantly lower for firms with a high CSR performance. We further find that the impact is evident only for large firms and those whose financial reports are audited by highquality auditors. However, our analysis suggests that political uncertainty and power distance intensity do not moderate the association between CSR performance and audit report lag. Our results remain robust after excluding some control variables, addressing the endogeneity issues, and using alternative audit report lag measures. This study contributes to audit delay literature by recognising CSR practices as a determinant of audit report lag in the GCC setting. The findings of this study carry valuable practical implications for regulatory bodies, policymakers, investors, and managers in the GCC region.

Goodwill Hunting: Why and When Ultimate Controlling Owners Affect Their Firms’ Corporate Social Responsibility Performance

Researchers have long been interested in how owners affect firms’ corporate social responsibility (CSR) performance. However, owners face diverging ethical preferences between funding and potentially benefiting from their firms’ CSR performance. To better understand owners’ influence on firms’ CSR performance, we focus on ultimate controlling owners with the highest control rights over their firms. We theorize that ultimate controlling owners with more control rights have stronger motivations and greater decision-making power to promote firms’ CSR performance to demonstrate that they are responsible owners and gain legitimacy and goodwill from their stakeholders. Moreover, we explore how this positive relationship is strengthened when ultimate controlling owners and their firms share similar corporate names and receive increased financial analyst coverage, as these conditions increase the likelihood of gaining legitimacy and goodwill through their firms’ improved CSR performance. We test our theory using a sample of 852 publicly listed Chinese firms from 2008 to 2017. Our findings support our theoretical predictions and contribute to a more nuanced understanding of how differences in ownership structure and owner type associated with ultimate controlling owners shape their motives and power to affect CSR performance in their firms.