‘Doing-good’ and ‘doing-well’ in Chinese publicly listed firms

Citation data:

China Economic Review, ISSN: 1043-951X, Vol: 23, Issue: 4, Page: 776-785

Publication Year:
2012
Usage 4009
Abstract Views 3952
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Citations 12
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Repository URL:
https://repository.hkbu.edu.hk/hkbu_staff_publication/2446; https://repository.eduhk.hk/en/publications/24d99654-984e-464f-a3e7-2d17db34c2d1
DOI:
10.1016/j.chieco.2012.03.013
Author(s):
Yan Leung Stephen CHEUNG; Kun JIANG; Weiqiang TAN
Publisher(s):
Elsevier BV; Elsevier
Tags:
Economics, Econometrics and Finance; China; Corporate social responsibility; Firm valuation; Overseas listing
article description
Recently, the presumed benefits of corporate social responsibility have become an important issue, especially for China where institutional settings are quite different from other parts of the world. Using an internationally accepted benchmark (OECD's Principles of Corporate Governance, OECD, 2004), this study constructs a corporate social responsibility (CSR) index to measure the quality of the corporate social responsibility practices of the 100 major Chinese listed firms during 2004–2007. This enables us to evaluate the progress of the corporate social responsibility practices of Chinese firms. The results show that Chinese companies have been making progress in their corporate social responsibility practices. The findings also show that market rewards Chinese firms for improving their corporate governance practices which implies ‘doing-good’ leads to ‘doing-well’ in the equity market in China. We also find that overseas-listed and more profitable Chinese firms have better improvement in CSR practice. This study has policy implications in pushing for further CSR initiatives in other emerging markets.