Corporate governance and corporate social responsibility disclosures: fresh evidence from China

Xue Gao, Md Moazzem Hossain, Manzurul Alam and Udani Edirisinghe

Journal of Accounting & Organizational Change, 2025, vol. 22, issue 2, 287-312

Abstract: PurposeThis study aims to investigate how corporate governance (CG) attributes and the the chief executive officer’s (CEO’s) political connections impacts on the corporate social responsibility (CSR) disclosure in the Chinese power and chemical industry.Design/methodology/approachThe study uses data from 265 Chinese power and chemical companies listed on the Shanghai and Shenzhen Stock Exchanges between 2013 and 2016 (for a total of 892 firm-year observations). The data were analysed using multiple regression techniques. The authors addressed the endogeneity issues between CG attributes and CSR disclosures and checked the robustness of our results in several ways, such as a fixed effect regression.FindingsThis study finds a significant positive relationship between internal control and CSR disclosures. In addition, the results indicate that CG attributes such as ownership, board independence and Audit committee have a significant positive impact on CSR disclosures. However, contradicting the literature, no significant relationship was found between the CEO’s political connections and CSR disclosures in the Chinese power and chemical industry context.Research limitations/implicationsThe findings of the study provide valuable insights for practitioners, regulators and policymakers on encouraging companies to enhance CSR disclosure by improving the quality of internal control and CG attributes in China’s heavily polluting industries. The findings may be useful for the users, regulators from the countries that share similar contextual and cultural values.Originality/valueThis study is among the few that examine CSR disclosure using a large sample within China’s power and chemical industries–sectors widely recognised as major environmental polluters and of growing concern to both the Chinese government and the international community.

Keywords: Corporate governance; Internal control; Political connections; Corporate social responsibility; China (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jaocpp:jaoc-05-2024-0143

DOI: 10.1108/JAOC-05-2024-0143

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