Changes in the Influence of Social Responsibility Activities on Corporate Value over 10 Years in China

Feifei Zhang and Jin-young Jung
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Feifei Zhang: College of Business Administration, Inha University, Incheon 22212, Korea
Jin-young Jung: College of Business Administration, Inha University, Incheon 22212, Korea

Sustainability, 2020, vol. 12, issue 22, 1-17

Abstract: This study analyzes changes in how corporate social responsibility (CSR) affects corporate value in China. We use multiple regression analysis on a sample of A-share listed companies on the Shanghai and Shenzhen Stock Exchanges from 2009 to 2018. We divide the sample into 2009–2012 and 2013–2018 periods according to the development of CSR-related media and corporate policies. The dependent variable is corporate value, measured by Tobin’s Q. The independent variable is the CSR score calculated and published by RKS, a widely recognized CSR evaluation agency in China. We use firm size, sales growth rate, return on equity, top 10 shareholders’ equity, operating cash flow, and debt ratio as control variables. The panel-based regression models find no statistical correlation between CSR score and corporate value from 2009 to 2012 but find that the CSR score has a significantly positive influence on corporate value from 2013 to 2018. The impact of CSR activities on corporate value increases over the 10-year period. This decade saw the Chinese government shift its development strategy from a rapid growth model to a high-quality growth model and pursue sustainable development. This study is useful for Chinese companies considering adopting CSR activities to promote sustainable development.

Keywords: China; corporate social responsibility; corporate value; CSR; sustainability; Tobin’s Q (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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