The Determinants of Virtue: Modelling Changes in the CSR Ratings of Chinese Firms

This study on Corporate Social Responsibility uses panel data on Chinese firms

From:
Foreign, Commonwealth & Development Office
Published
30 November 2017
Country:
China
Document Type:
Working Paper
Theme:
Economic Growth
Authors:
Wu, S, Appleton, S, Song, L, Wang, J

Abstract

Most empirical studies on Corporate Social Responsibility (CSR) use cross-sectional data or case studies, making causality hard to establish. We overcome this limitation by using panel data on Chinese firms. We find no effect of last year’s profits on CSR ratings, although their negative contemporaneous relation suggests a trade-off. Managerial shareholdings reduce CSR ratings while rising wages and employment are the main drivers of increasing CSR ratings. This suggests the CSR agenda aligns with the interests of labour, but not capital. However, the positive effect of Tobin’s Q may indicate CSR is associated with intangibles of value to a firm.

This work is part of the ‘Local government, economic growth and human development: Chinese lessons for Kenya and Uganda?’ project

Citation

Shuangqi Wu, Simon Appleton, Lina Song, Lina, Jinmin Wang (2017). The Determinants of Virtue: Modelling Changes in the CSR Ratings of Chinese Firms. IZA Discussion Papers 11153, Institute for the Study of Labor (IZA).

The Determinants of Virtue: Modelling Changes in the CSR Ratings of Chinese Firms (PDF, 340KB)

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Published 30 November 2017
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