Corporate philanthropy and corporate social irresponsibility during the COVID-19 pandemic: evidence from China

Muhammad Ishfaq Ahmad, Martin Cepel, Enrico Battisti and Ramiz Ur Rehman

International Journal of Emerging Markets, 2023, vol. 20, issue 3, 1000-1018

Abstract: Purpose - This study aims to investigate the perspective of corporate philanthropy during the coronavirus disease 2019 (COVID-19) in China for firms with various levels of corporate social responsibility (CSR). Specifically, the study appraises the impact of the COVID-19 pandemic on the stock returns and sustainable development of Chinese-listed companies and determines the likelihood of paying donations vis-à-vis firm reputation. Design/methodology/approach - The study used data from 117 Chinese-listed firms engaged in philanthropy during the COVID-19 pandemic. The authors also utilized the stock returns and cash donation data, and owing to the cross-sectional data and continuous nature of dependent variables, they employed the ordinary least squares regression to test the research hypotheses. Findings - The results show that irresponsible actions have a positive relationship with donations. The study particularly reveals that irresponsible firms have significant negative abnormal returns during the first wave of the COVID-19 pandemic. Originality/value - To the best of our knowledge, this is the first empirical study to explore the perspective of corporate philanthropy during the COVID-19 pandemic for companies with different CSR levels. This study contributes to the empirical research on CSR and provides insights for managerial-cum-financial decisions to encourage managers of irresponsible firms to pursue philanthropic behaviors after crisis events.

Keywords: Corporate social irresponsibility; Corporate philanthropy; Stock returns; COVID-19; China (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijoemp:ijoem-08-2022-1310

DOI: 10.1108/IJOEM-08-2022-1310

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