Corporate philanthropic response to the COVID-19 pandemic in China: a dilemma?

Hailiang Zou, Zedong Liang, Guoyou Qi and Hanyang Ma

Social Responsibility Journal, 2022, vol. 19, issue 6, 1085-1106

Abstract: Purpose - This study aims to examine the corporate donations in response to the intensive outbreak of the COVID-19 pandemic in China in 2020 and proposes that the local spread of COVID-19 is negatively associated with corporate donations due to the non-trivial costs, but meanwhile, strong institutional pressures based on institutional theory are put on firms to donate, which thus creates a dilemma for firms. This study further argues that the dilemma is heterogeneous across different institutional fields. Design/methodology/approach - Using a sample of Chinese listed companies during the intensive outbreak of this pandemic, a two-stage Heckman selection model is conducted to address the potential sample selection bias. Findings - This study reveals a negative relationship between the local spread of COVID-19 and corporate donations, confirms the driving effect of various types of institutional pressure and finds that the intensity of the COVID-19 pandemic strengthens the effect of coercive pressure and mimetic pressure on philanthropic giving but weakens the effect of normative pressure. Originality/value - This study extends the knowledge on firms’ philanthropic response to natural crises, as the COVID-19 pandemic has not only led to a public health crisis but also to a global economic crisis, and how the effects of institutional pressures are affected by a situational crisis. This work enriches the literature on corporate philanthropy and crisis management and has some implications for both policymakers and business practitioners.

Keywords: Institutional pressures; Normative pressure COVID-19; Coercive pressure; Corporate philanthropic giving; Mimetic pressure (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eme:srjpps:srj-10-2021-0432

DOI: 10.1108/SRJ-10-2021-0432

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